The £14 billion Scottish Mortgage Investment Trust, which is managed by Edinburgh investment partnership Baillie Gifford, has revealed it will make at least £1bn available to buy back its shares over the next two years.

It noted yesterday that its shares were trading at around a 14% discount to net asset value.

Justin Dowley, who chairs Scottish Mortgage, said: “We remain committed to using share repurchases strategically to enhance liquidity in our shares and to seek to facilitate trading around net asset value.”

The trust said: “Over the last two years, Scottish Mortgage has bought back approximately £353 million of its shares. During this time, the board and managers have been actively considering increasing the level of buybacks to address the discount.”

Baillie Gifford partner Tom Slater, manager of Scottish Mortgage, said: “We own a portfolio of established companies achieving rapid expansion, propelled by enduring structural trends. We intend to pursue this opportunity with conviction."

Aidan Moyle, investment analyst at stockbroker Hargreaves Lansdown, said: “The trust has been trading at a significant discount since 2022.”

He added: “We have conviction in lead manager Tom Slater. He has an excellent long-term track record although the trust has struggled more recently as rising interest rates and inflation moved investors away from a growth style of investing to a focus on a value style of investing.

“With inflation falling and interest rates likely to fall, this could be a catalyst for the trust to move back into favour.”

Mr Slater said: “Advances in foundational technologies are unlocking exciting new products, services, and business models. These well-funded public and private companies are shaping the future of the economy. The stock market has yet to fully recognise their progress, which creates the opportunity for us to buy the portfolio for less than its market value. In doing so, we can provide liquidity and augment returns for our shareholders."

Scottish Mortgage noted that it “invests in companies with the potential for exponential growth over the long term”.

It added that its portfolio is “home to a range of exceptional businesses, both public and private, including ecommerce pioneer MercadoLibre, leading luxury brand Ferrari, and SpaceX, which is revolutionising worldwide internet access through its Starlink satellites”.

Scottish Mortgage noted that it has, over the last 10 years, delivered a total return on net asset value of 359%, with the FTSE All-World Index delivering a 211% return over the same period.