One of the top-performing global technology funds is making a bet that the next leg of tech returns won’t come from Silicon Valley. Liontrust’s Global Technology Fund has nearly doubled its China allocation from roughly 6% to 11%, rotating profits out of US heavyweights and into Chinese companies riding the AI wave.
The fund posted returns of 13.3% as of May 2025, landing it in the first quartile among its peer group. Meanwhile, the broader MSCI World IT index was actually in negative territory over the same stretch.
What’s driving the China rotation
US tech stocks had an extraordinary run, and some of the biggest names, Nvidia and Apple among them, started looking stretched. The fund took profits on those positions and redirected capital toward Chinese tech companies it viewed as undervalued relative to their growth trajectories.
Tencent and Meituan became key contributors to fund performance in February 2025. That timing followed DeepSeek’s AI model announcement in late January, which sent a jolt of optimism through China’s tech sector by demonstrating that Chinese companies could compete credibly in the AI arms race without relying on the most advanced Western chips.
