Welcome to the website for Herald Investment Management Limited (HIML). These pages provide a brief introduction to HIML and details of the funds it manages, currently Herald Investment Trust (HIT), the Herald Worldwide Fund (HWF) and Herald Ventures LP (HVLP).
These pages are regularly updated to include up-to-date financial and performance data, but please feel free to contact us with comments, or to request further information. It is important that you read the notice below before proceeding, as it explains certain legal and regulatory restrictions which apply to the information contained in this website.
The information provided in this website is solely for use by individuals who are resident in the United Kingdom and are subject to UK tax and is not intended for, and should not be regarded as an offer or solicitation to sell investments in any jurisdiction other than the UK.
Individuals who are not resident in the UK should not continue as it may be contrary to local laws or regulations to receive information in connection with, or to apply for, a UK investment. In particular, Herald Investment Trust (HIT) shares are not registered under United States securities law and, subject to limited exceptions, may not be offered, sold, transferred or delivered in the United States or to US persons. By proceeding, you are representing and warranting that you are not resident in, or a citizen of, a jurisdiction outside the UK.
Stock market and currency movements may cause the capital value of shares and the income derived from them to go down as well as up, and investors may get back less than they invested. Past performance is not necessarily a guide to future performance. The value of any tax relief you may be entitled to will depend on your individual circumstances. Tax rates, and reliefs, as well as the tax treatment of PEPs, may be changed by future legislation.
This web site is approved for purposes of UK regulation, by Herald Investment Management Ltd (HIML). It is not to be considered as investment advice. Herald Investment Management Ltd is authorised and regulated by the Financial Services Authority.
Although we have taken reasonable care to ensure that the facts contained in these pages are accurate, no representation or warranty, express or implied, is made to its accuracy or completeness.
The information herein is not for distribution outside the UK. Under no circumstances should this information, or any part of it be copied, reproduced or redistributed. No rights of any kind are licensed or assigned or shall otherwise pass to persons accessing this information.
If you are in any doubt about any of the information contained herein please consult your stockbroker, solicitor, accountant or other professional adviser.
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Herald Investment Trust plc was launched with a smaller companies remit in 1994, and globalised in 1996 with a realisation that you had to understand the US sector to aspire to be expert, and to be able to cross reference investments. By the same token the desire for expertise necessitated an understanding of the dynamics of large companies in the technology, media and telecommunications (TMT) sectors, and having a fund in which to make these investments was desirable. HWF was therefore launched in April 1998. The fund benefited from the ensuing technology bubble, but suffered badly in the subsequent breakdown. However, the fund was well positioned to exploit the rally in 2003, and has continued to perform well.
The TMT sector globally is now cUS$5tr, but under represented in the UK market. The market is essentially global, and managing a global fund has advantages in assessing the global trends and relative valuations, versus the majority of money managers who have a narrower geographic focus.
The sector is not homogeneous, and specialist management ought to outperform any technology index. Innovation leads to replacement cycles, from which the incumbents do not necessarily benefit, and disruptive innovation can lead to the emergence of new markets. This has been the pattern over the last fifty years. The first big market was the mainframe computer, which had its heyday in the 1960s, and IBM came to dominate. The personal computer market emerged in the 1980s, and has led to many globally significant companies- Microsoft, Intel, Western Digital, Seagate, Symantec, McAfee, HP, Dell, Acer, Hon Hai, Adobe - to name but a few. Networking and the roll-out of the corporate local area network was the driver of PC growth in the 1990s, and led to the emergence of Cisco. This century has seen the roll-out of broadband globally with a high consumer penetration, social networking. Google, Facebook, Twitter and Amazon are all now household names. The mobile phone market emerged in parallel with the PC market. The most recent market to open up has been the mobile internet led by Apple. Arguably the iPad and similar e-readers mark the first major disruption in books since the Gutenberg press.
HWF has been established to exploit these opportunities, with focused specialist management.
The large capitalisation remit means that performance diverges from the Herald Investment Trust plc. In particular the fund outperformed Herald Investment Trust plc from the Autumn of 2007 to the end of 2008. This reflected the fact that there was a much greater market breakdown in the smaller companies market, when distressed selling led to savage price declines; secondly a greater percentage of the portfolio was invested in $ denominated investments, the benefits of which were immediately recognised; and thirdly it did not suffer from a widening of the discount. For investors who value the liquidity associated with larger capitalisation investments this vehicle has appeal. The fund has outperformed HIT by over 30% between 31 December 2006 and 31 December 2010, and performed well relative to peers.
The portfolio has been concentrated in quality companies through the downturn, and we have not attempted to read the market, but to stick to companies in which we believe. The performance has, therefore, been derived from stock selection rather than market timing.