Scottish Mortgage’s Premium Reversal: Share Issuance Returns as SpaceX Stake Soars to 1,500p

After years of buybacks, Scottish Mortgage Investment Trust issues new shares as 6.5% premium emerges, fueled by a 1,900% return on its SpaceX stake ahead of a potential June IPO.

After spending billions of pounds buying back its own shares to close a stubborn discount, the Scottish Mortgage Investment Trust has flipped the script. For the first time in nearly five years, the FTSE 100-listed fund is issuing new shares — a direct result of demand so strong that its stock now trades at a premium to net asset value.

Since late April 2026, Baillie Gifford has been tapping the trust’s treasury to issue new shares daily. The catalyst? A premium of roughly 6.5% over the last reported NAV of 1,394.81 pence (20 May). By the close of the week on 22 May, the diluted NAV had ticked up to an estimated 1,408.29 pence, while the shares themselves punched through the 1,500-pence barrier for the first time since 2021 — a level equivalent to around €17.93. The milestone marks a near-50% gain over the past twelve months.

The turnaround is dramatic. In 2023, Scottish Mortgage shares had sunk as low as 621 pence, and the trust had ploughed up to £1 billion into buybacks in a bid to narrow the gap to NAV. Now, with the premium firmly in place, issuing shares from the treasury does not dilute existing holders — it actually captures the premium for the benefit of the fund.

SpaceX: the engine of the re-rating

The primary force behind the surge is one of the most spectacular private bets in the trust’s portfolio. SpaceX now accounts for 19.3% of total assets, up from an initial £151 million investment. That stake is currently valued at roughly £2.98 billion — a return of 1,900%. The massive revaluation comes as SpaceX prepares for a June initial public offering that could be the largest in history. The company is targeting a valuation of $1.25 trillion and hopes to raise up to $75 billion, though existing shareholders face a lock-up period of 180 days.

Just two days before the 1,500-pence milestone, SpaceX notched a critical technical achievement. On 22 May, its Starship V3 rocket reached orbit for the first time during its twelfth test flight, successfully deploying simulated Starlink satellites from an altitude of 124 metres. Though the Super Heavy booster was destroyed during landing, the primary mission objectives — testing new hardware and releasing orbital cargo — were met. Elon Musk has since talked up plans for more than 10,000 Starship launches per year, with annual payload capacity of 2 million tonnes.

Balancing the books: losses, debt, and portfolio weight

The SpaceX bet is not without risk. The company reported a consolidated net loss of $4.27 billion in the first quarter of 2026, against total assets of $102 billion and debt of $60.5 billion. The trust’s concentrated exposure — now nearly one-fifth of the entire portfolio — means any wobble in the SpaceX narrative could hit Scottish Mortgage hard. Still, the broader portfolio has also contributed to the rally. The five largest listed holdings at the end of the first quarter were TSMC (5.72%), MercadoLibre (3.99%), Amazon (3.56%), ASML (3.22%), and Nvidia (3.17%).

With a market capitalisation of roughly £16.2 billion and total assets of £16.7 billion, Scottish Mortgage remains the largest global equity investment trust in the UK by a wide margin.

Technical and macro backdrop

The stock now sits just 2% below its all-time high of 1,528 pence set in November 2021. The relative strength index stands at 40.6, neutral territory, but the price has carved out a fresh 52-week high, with technical support now established at the 1,500-pence mark. The macro environment has also been supportive: the FTSE 100 has climbed to around 10,377 points, helped by hopes of peace talks in the Middle East, while the yield on ten-year US Treasuries has eased to 4.46%, a tailwind for growth-heavy technology holdings.

What to watch next

The coming week brings two pivotal events for the trust: further details on the SpaceX IPO — specifically price and date — and inflation data from both the US and the UK. The share issuance programme will also be in focus: whether the premium compresses as new shares hit the market could determine whether the rally can sustain its momentum. For now, the trust is enjoying a rare alignment of private-market excitement and public-market demand — a combination that has turned share buybacks into share issuance.