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The Bankers Investment Trust PLC

How the Bankers Investment Trust approaches AI: disciplined, diversified and long term

Rather than chasing hype, Bankers takes a selective approach to AI investing. Richard Clode, the co-fund manager of Bankers, explains how the trust manages risk while seeking to benefit from one of the most important technology shifts of our time.

Q: Are we in an AI valuation bubble?

While some individual stocks may look expensive, today’s market looks very different from 2000. Back then, valuations were extreme and enthusiasm was widespread. Today, there is still healthy debate around spending, profits and valuation, which suggests a more measured environment.

“We don’t invest in ‘AI’ as a single bet. We invest in strong businesses that can turn technology into profits and cash flow.”

 

Q: How does Bankers manage AI‑related risks?

We don’t invest in AI as a single theme. Instead, we focus on individual companies with strong balance sheets, clear revenue models and the ability to generate real profits and cash flow.

In practice, that means favouring established businesses already benefiting from AI demand today. For example, companies such as NVIDIA and Taiwan Semiconductor Manufacturing sit at the heart of the AI supply chain, supplying the chips needed to power AI systems. Others, including Microsoft, Alphabet and Amazon, are investing heavily in AI but are doing so from a position of financial strength, using existing cash flows rather than relying on external funding.

Diversification is also critical. Bankers invests across regions and sectors, including companies that benefit from AI outside the technology sector. We see AI creating opportunities in areas such as financials, where well‑capitalised banks like JPMorgan Chase can use AI to improve productivity and efficiency while operating in a highly regulated environment. This broader exposure helps reduce reliance on any single technology or outcome.

Q: What should investors take away from all this?

AI is likely to be the defining technology wave of the coming years, much like the internet was over the past two decades. That creates both risks and opportunities.

Our role as long‑term stewards of capital is to stay disciplined, focusing on fundamentals rather than headlines, and to identify businesses that can genuinely turn this technology into sustainable profits. That approach has served investors well through previous periods of major change.

 

Balance sheet

A financial statement that summarises a company’s assets, liabilities, and shareholders’ equity at a particular point in time. Each segment gives investors an idea as to what the company owns and owes, as well as the amount invested by shareholders. It is called a balance sheet because of the accounting equation: assets = liabilities + shareholders’ equity.

Capital

When referring to a portfolio, the capital reflects the net-asset value of a fund. More broadly, it can be used to refer to the financial value of an amount invested in a company or an investment portfolio.

Cash flow

The net balance of cash that moves in and out of a company. Positive cash flow shows more money is moving in than out, while negative cash flow means more money is moving out than into the company.

Valuation metrics

Metrics used to gauge a company’s performance, financial health, and expectations for future earnings, e.g. P/E ratio and ROE.

These are the views of the author at the time of publication and may differ from the views of other individuals/teams at Janus Henderson Investors. References made to individual securities do not constitute a recommendation to buy, sell or hold any security, investment strategy or market sector, and should not be assumed to be profitable. Janus Henderson Investors, its affiliated advisor, or its employees, may have a position in the securities mentioned.

 

Before investing in an investment trust referred to in this article, you should satisfy yourself as to its suitability and the risks involved, you may wish to consult a financial adviser. Please refer to the AIFMD Disclosure document and Annual Report of the AIF before making any final investment decisions. Tax assumptions and reliefs depend upon an investor’s particular circumstances and may change if those circumstances or the law change.

 

Past performance does not predict future returns. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originally invested.

 

The information in this article does not qualify as an investment recommendation.

 

There is no guarantee that past trends will continue, or forecasts will be realised.

 

Marketing Communication.

 

Glossary

 

 

 

Important information

Please read the following important information regarding funds related to this article.

Before investing in an investment trust referred to in this document, you should satisfy yourself as to its suitability and the risks involved, you may wish to consult a financial adviser. This is a marketing communication. Please refer to the AIFMD Disclosure document and Annual Report of the AIF before making any final investment decisions.
    Specific risks
  • Some of the administrative expenses are taken from capital. This allows more income to be paid but it may also restrict capital growth or even reduce the capital over time.
  • Losses could be incurred if a counterparty became unwilling or unable to meet its obligations, or as a result of failure or delay in operational processes or the failure of a third party provider.
  • Derivatives may be used with the aim of reducing risk or managing the portfolio more efficiently. However, this introduces other risks, in particular, that a derivative counterparty may not meet its contractual obligations.
  • This investment should be held as part of a broader diversified portfolio. Balancing it with investments that have different risk profiles can help reduce the impact of any single investment underperforming.
  • The Company may borrow to invest, which could magnify gains or losses.
  • As the Company may borrow to invest, changes in interest rates could increase or decrease the cost of any borrowings.
  • The Company invests in the shares of other companies. These shares may become hard to value or to sell at a desired time and price, especially in extreme market conditions when asset prices may be falling, increasing the risk of investment losses.
  • Your return on investment is directly related to the market price of the Company's shares, which may be higher (trading at a premium) or lower (trading at a discount) than the value of its underlying net asset value assets. This means your returns may differ from the performance of those assets.
  • While active management techniques are typically positive for performance, this approach may also result in periods of underperformance relative to the benchmark and comparable passive and index-tracking funds, particularly during unexpected market shifts.
  • Shares can gain and lose value rapidly, and typically involve higher risks than bonds or money market instruments. The value of your investment may rise and fall in line with the underlying equity markets.
  • If the companies in which the portfolio is invested persistently reduce their dividend payments, the Company will find it more difficult to maintain or grow its own dividend payments each year.
  • The portfolio invests in currencies other than sterling, meaning fluctuations in exchange rates could affect returns.
  • The Company maintains a portfolio with a bias towards income-generating companies. This may result in the Company significantly underperforming or outperforming the wider market.