Scottish Mortgage Shifts Gears: Premium-to-NAV Issuance Replaces Buybacks as SpaceX Drives Record Returns

Scottish Mortgage sells shares above NAV for the first time, raising £17.3m, as its 19% SpaceX stake drives demand and record returns.

Scottish Mortgage Investment Trust has turned its capital-allocation playbook upside down. After years of buying back its own shares when they traded at a discount to net asset value, the £16.1bn trust is now selling stock from its corporate treasury at a premium – a clear sign that the market’s hunger for its private-market bets, above all the giant SpaceX stake, has reshaped investor psychology.

The most recent move came on 28 May 2026, when the trust placed 1.15 million fully paid ordinary shares from its treasury at 1,502.02 pence each, raising approximately £17.3m. Crucially, the placement price stood well above the fair-value NAV of 1,409.70 pence, meaning existing shareholders suffered no dilution. The share price at the time of the transaction was 1,499.25 pence, confirming a persistent premium. After the sale, roughly 374.7 million shares remain in treasury, while the total number of shares in circulation outside the corporate book rose to just under 1.11 billion.

This pivot from repurchases to issuance is no accident. Buybacks typically signal that a trust is trading below its portfolio value; the reverse move – selling shares above NAV – points to buoyant demand. Scottish Mortgage is now exploiting that demand, and it has the performance to justify it. For the financial year ended March 2026, the trust delivered a NAV total return of 27.4% using debt at market value, comfortably outpacing the 18.0% return from the FTSE All-World Index in sterling terms. The share price advanced 26.8% over the same period, and since the start of the calendar year the stock has climbed roughly 28%.

The engine behind those numbers is overwhelmingly one holding: SpaceX. Elon Musk’s space venture now accounts for more than 19% of the trust’s assets, with a valuation placed at $1.25 trillion. Chairman Christopher Samuel described it as a “significant uplift after an operationally strong year,” while portfolio manager Tom Slater characterised SpaceX as a “dual monopoly” in launch services and a “global connectivity utility” via Starlink, whose satellite network is aiming for software-like margins. The trust’s closed-end structure allows it to hold the position through any future initial public offering without being forced to sell.

Alongside the share issuance, Scottish Mortgage extended its dividend streak for the 43rd consecutive year, lifting the payout by 4.3% to 4.57 pence per share. Ongoing charges remain low at 0.33%, with no performance fees. Gearing stands at around 11%, and the interest cost is roughly 3.6%.

The treasury sale on 28 May is not an isolated event. Just before the annual results, the trust placed 2.25 million shares from its own holdings at nearly 1,497 pence, also at a premium to NAV. That double-barrelled approach suggests management sees the current backdrop – strong annual returns, a high SpaceX valuation, and share price momentum – as an opportunity to raise cheap capital without selling any portfolio companies.

Whether the trust can keep issuing at a premium depends on the durability of that narrative. The concentration on a single private company carries obvious risks, but for now investors are betting that Starlink’s recurring revenue model and SpaceX’s launch dominance will continue to justify the premium – and keep Scottish Mortgage’s treasury desk busy.