Stellar year for the best-selling Seraphim Space

Of the ten best-selling investment trusts on Fidelity Personal Investing in 2026, the most innovative must surely be Seraphim Space. The £553m fund mainly focuses on unlisted SpaceTech companies and has just delivered an annual share price total return of more than 100%. Please remember past performance is not a reliable indicator of future returns.

Writing in the accounts, the Chair said that it had been a watershed year for the space sector, with SpaceX’s record-breaking IPO underscoring the growing commercial and strategic importance of the area.¹

“With SpaceTech sharing many of AI’s defining characteristics in terms of its capacity to reshape industries, we believe the sector is now entering a new multi-decade cycle of wider adoption of now proven technologies and the emergence of new capabilities across the on-orbit economy.”²

Objective and approach

Launched in July 2021, Seraphim Space was the world’s first listed SpaceTech fund. It aims to deliver long-term capital growth through an international portfolio of predominantly privately financed, early and growth stage SpaceTech businesses operating in areas such as global security, cybersecurity, food security, climate change and sustainability.³

The trust is run by Seraphim Space Manager LLP, whose team includes seasoned venture capitalists, as well as some of the sector’s most successful entrepreneurs. Since 2016, the firm has supported more than 150 SpaceTech companies across its fund management and accelerator activities.⁴

The manager’s involvement at the heart of the sector provides access to a global pipeline of investment opportunities. This helps it identify and back emerging businesses that have the potential to play a significant role in the years ahead.⁵

• Refer a friend and you’ll both receive a £100 Amazon.co.uk gift card when they invest £5,000 or more in a qualifying account. T&Cs and exclusions apply. Find out more

The portfolio

At 30 June, the portfolio comprised 23 SpaceTech companies, as well as an investment in the Seraphim Space Ventures II LP fund. The five largest holdings accounted for 75% of the trust’s fair value, while the top ten represented 97%⁶, with 93% being privately listed.⁷

At 54%, the biggest allocation by far was ICEYE, a Finnish satellite operator that recently partnered with Nokia to co-develop a European sovereign satellite communications capability intended to rival Starlink.⁸ The increase in fair value of this company accounted for the majority of Seraphim’s gain over the year, but it now dominates the whole portfolio.⁹

Interestingly, the trust does not currently hold SpaceX, arguably the world’s best-known SpaceTech company. This reflects the manager’s tendency to avoid investments in rocket-launch businesses.¹⁰

Impressive but volatile performance

The annual report for the year ended 30 June shows that the underlying portfolio reached 359.6% of its original cost,¹¹ as the fair value of its holdings increased by 133% to £605.5m. As a result, the trust delivered an NAV total return of 102.9% and a share price total return of 119.4%.¹²

It can be a very volatile area, however, with the recent strong performance bringing the five-year annualised NAV total return per ordinary share to 19.1%. This is broadly in line with the long-term target of at least 20%, which serves in place of a formal benchmark index.¹³

C Share issue

The healthy performance helped the trust to raise additional gross proceeds of £137m through a new C share issue in May. By 13 October, £72.5m had been deployed across five existing holdings and one new investment.14 This was enough to trigger the conversion of the first tranche into ordinary shares, with the conversion ratio due to be announced at the AGM on 25 November.¹⁴

Private companies typically require further funding rounds as they develop, so the successful C share issue has given the trust additional resources to support its portfolio. Seraphim appears well-capitalised, with a number of the holdings already thought to be fully funded and/or expected to be profitable in the near term.¹⁵

Discount and costs

At 30 June, the ordinary shares were trading at a 22% discount to NAV, down from 28% the year before. This improvement reflected the strong performance during the period, with no shares repurchased.¹⁶

The C shares were trading at a 20% discount.¹⁷ The first continuation vote will take place at the forthcoming AGM, with subsequent votes held every five years thereafter.¹⁸

Ongoing charges fell from 1.77% in 2025 to 1.36%,¹⁹ which is on the expensive side but reflects the illiquid nature of the holdings. There is also a performance fee of 15% of returns above an 8% annual hurdle rate, subject to a high-water mark,²⁰ with a provision of £54m in the accounts, although the pay-out conditions have not yet been met.²¹

• Looking for personalised financial advice? Our advisory service can help you plan for your next step.

What do the brokers say?

Winterflood says that it was a very strong year, with the portfolio more than doubling in value, materially improved portfolio funding positions and clear evidence of commercial maturation across several holdings.²²

“Importantly, the profitability milestone we highlighted last year has moved closer, with management teams representing a majority of portfolio fair value expecting EBITDA profitability by end-2026, while only 3% of portfolio fair value now has less than 12 months of [cash] runway. The successful £136.5m C share raise also materially improves Seraphim’s ability to back existing winners and add new investments.”²³

The broker identifies portfolio concentration as the main risk, with ICEYE now representing 54% of NAV, meaning that future returns will be heavily influenced by a single holding.²⁴

• More on Seraphim Space

Source:

^{1,2,3,4,5,7,8,11,14,15,17,19,21} Seraphim Space, annual report, 30.6.26
^6,18,20 Peel Hunt, 15.10.26
^{9,12,13,14,16,22,23,24} Winterflood, 15.10.26
¹⁰ Citywire, 2.9.26

Past performance is not a reliable indicator of future returns
Source: Morningstar, total returns in GBP terms from 30.9.21 to 30.9.26. Excludes initial charge.

• Read: Top 10 best-selling ETFs of 2026
• Read: The top 8 questions our advisers get asked
• Read: ISA ideas: low-cost index tracker fund options

Important information - investors should note that the views expressed may no longer be current and may have already been acted upon. This investment trust invests in overseas markets and so the value of investments can be affected by changes in currency exchange rates. The shares in Seraphim Space investment trust are listed on the London Stock Exchange and their price is affected by supply and demand. The trust can gain additional exposure to the market, known as gearing, potentially increasing volatility. Before investing, please read the relevant key information document which contains important information about the fund. Eligibility to invest in an ISA and tax treatment depends on personal circumstances and all tax rules may change in the future. This information is not a personal recommendation for any particular investment. If you are unsure about the suitability of an investment you should speak to one of Fidelity’s advisers or an authorised financial adviser of your choice.