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The policy of Herald Investment Trust plc (HIT) is to achieve capital appreciation through investment in smaller quoted companies, principally in the UK but also in the rest of the world, in the areas of technology, communications and media in all its forms. The business activities of investee companies include information technology, broadcasting, printing and publishing and the supply of equipment and services to these companies. HIT is managed by Herald Investment Management Limited (HIML).
Convergence - Driving Change, Driving Growth
The fundamental driver behind the growth in the companies that fall within the HIT remit is the convergence of the various forms of technology, communications and media. The traditional businesses in the sectors followed include broadcasting, publishing, telecommunications, information technology, advertising and printing. This focus means HIT does not invest in pharmaceutical or biotechnology companies, as is typically the case with other specialist technology funds.
Convergence Matrix: Market Opportunities
The past few decades have seen the emergence of technology to become a significant influence over people’s lives, business practices, and world economies. Indeed, the spend on technology has been increasing as a percentage of GDP for many years, even though hardware (the largest single cost) is increasingly deflationary. The significant advances in the technologies, methods and applications used within these sectors cannot be ignored. Nevertheless evolution and adoption continue at a very rapid pace, further spurred by continued industrial revolutions caused by such innovations as the silicon chip and the personal computer in the 'distant' past, and the Internet, mobile and broadband communications, and the network computing model more recently.
It is the strong belief of Herald Investment Management Limited, the manager of HIT, that the multimedia revolution is still at a very early stage, and will continue to emerge, penetrate and evolve for a significant period of time. The strong overall growth seen by these emerging markets provides a significant investment opportunity. However, the rapid evolution and proliferation of technologies and applications creates a notable obstacle to keeping up-to-date with the companies and their offerings. As such, it is HIT’s belief that a dedicated and specialist team is required to follow these industries adequately and realise the potential significant investment gains.
The HIT 'multimedia' remit can therefore be encapsulated as those companies whose principal activities relate to the preparation, production, processing, distribution or transmission of information, ideas or entertainment, whether in the form of data, text, sound or image. In addition, the remit includes those companies engaged in the supply of hardware, software or services to the users and providers of information.
