For those who can’t wait till SpaceX goes public, here are three investment trusts to consider buying today. All are managed by Baillie Gifford, the Edinburgh-based investment firm that was invited to invest in SpaceX due to its patient, long-term backing of Tesla.

FTSE 100

Scottish Mortgage Investment Trust (LSE:SMT) manages a global growth portfolio of 101 stocks. It aims to “find exceptional growth companies, whether public or private, wherever they are in the world, and hold them over the long term“.

Here are the top five holdings, with their respective weightings:

• SpaceX: 19.3%
• TSMC: 5.7%
• ByteDance: 4.7%
• MercadoLibre: 4%
• Stripe: 3.9%

In the past 10 years, Scottish Mortgage has generated an excellent annualised return of 17%. SpaceX has contributed towards that because the trust first invested in the rocket maker back in 2018 when it was valued at around $31bn.

With Elon Musk seeking a valuation as high as $2trn, this holding is set to generate enormous returns. It’s another massive winner that Scottish Mortgage can put in the trophy cabinet, alongside Nvidia, Tesla, ASML, and Spotify.

I consider Scottish Mortgage to be the least risky of these three trusts due to its global portfolio. It holds established European blue chips like Ferrari, Hermes, and Swedish industrial giant Atlas Copco.

That said, it wouldn’t be immune to a global economic slowdown, especially as it holds lots of e-commerce stocks, including Amazon, Shopify, MercadoLibre, Temu owner PDD Holdings, and Sea Limited.

FTSE 250

Baillie Gifford US Growth Trust (LSE:USA) from the FTSE 250 is similar to Scottish Mortgage, but it’s entirely focused on American businesses. It also has a higher 50% limit on private company exposure (Scottish Mortgage is currently 30%).

Due to being less geographically diversified then, it’s arguably higher risk. If there was a US government debt crisis, for example, global investors could quickly dump American equities.

On the other hand, the US remains a breeding ground for the world’s most innovative companies. So I expect this trust to continue doing well long term (it’s up over 200% since launch in 2018).

The top five holdings are:

• SpaceX: 14.9%
• Stripe: 8.5%
• Amazon: 4.4%
• Nvidia: 4.3%
• Meta Platforms: 3.8%

A FTSE 250 newcomer

Finally, there’s Schiehallion Fund (LSE:MNTN), which recently joined the FTSE 250. It takes its name from the mountain in Scotland, which has historical scientific significance as it was used to calculate the Earth’s mass in 1774. 

The trust focuses on later-stage private growth companies, so I consider it higher risk. After all, unlisted valuations can be harder to get accurate while the firms are less established.

As such, Schiehallion can be incredibly volatile, especially when interest rates rise, as the share price chart shows.

The top five holdings are:

• Bending Spoons: 14.2%
• SpaceX: 12.8%
• ByteDance: 8.9%
• Databricks: 4.5%
• Stripe: 4.4%

Recent performance has been strong. In the 12 months to 31 January, the fund’s net asset value increased 32.6%. It could grow even more this year if the SpaceX IPO is successful.

Schiehallion says SpaceX “continues to exhibit arguably one of the strongest competitive advantages that we have ever seen“.

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Due to all the choice, it’s perfectly possible to build a diversified and high-quality portfolio through investment trusts. Here are two from the FTSE 250 I like in April.

Private markets

Schiehallion Fund (LSE:MNTN) is a newcomer to the mid-cap index, having joined in March. While it has more than doubled in 12 months, the trust remains 36% below highs reached back in 2021, when growth stocks overheated.

So what does this quirkily-named Baillie Gifford-run fund do? It invests in later-stage growth companies not yet listed on stock markets. Familiar holdings include SpaceX, TikTok owner ByteDance, payments giant Stripe, and Claude AI maker Anthropic.

What I like here is that Schiehallion is quite picky about which businesses it invests in. In 2024, it only made six new investments from more than 600 financing rounds it looked at.

We continue to judiciously deploy capital only into those companies that we regard to represent the very best private growth opportunities on offer.

Schiehallion Fund.

In the first half of 2025, net asset value (NAV) increased 9.9%, driven by top holdings SpaceX and Bending Spoons. The latter’s an Italian software company that buys and improves well-known-but-underperforming apps or platforms (it recently acquired Vimeo and AOL).

Another thing I like is that the trust’s willing to stay invested after a firm goes public. Funds like this normally exit their holdings to redeploy cash. But here we see listed stocks including Wise, Affirm, Chime and Tempus AI still in the portfolio. The aim is to capture more of a growth company’s lifecycle.

Looking ahead, one risk is that interest rates might be heading higher, which could put pressure on growth stock valuations. And while a successful blockbuster SpaceX IPO this summer could send Schiehallion shares flying even higher, the opposite’s also true.

Weighting things up, I’m bullish on this unique trust’s long-term prospects. The portfolio contains some exciting growth companies, including Anthropic, Revolut, SpaceX, Databricks, and UK self-driving software firm Wayve.

Out-of-favour stock

My second pick is Finsbury Growth & Income Trust (LSE:FGT), which focuses primarily on UK shares. Now, this one’s had a torrid time, falling 25% since January 2025. Over five years, Finsbury has declined 17.5%, significantly underperforming the FTSE All-Share index.

Admittedly, there’s a risk that the stock-picking skills of fund manager Nick Train may no longer be as sharp as they once were. Because many picks have performed very poorly in recent years, including Diageo, Fevertree Drinks and Burberry.

In 2026, the trust has been hit by the software sell-off, as it holds Sage, Experian, London Stock Exchange, RELX, Rightmove, and Autotrader. In hindsight, piling into so many software/data platforms was perhaps a tad rash.

Taking a contrarian view however, many of these stocks now appear fundamentally undervalued to me. Sage, for example, is trading at just 15 times next year’s earnings. Autotrader’s a mere 12.3 times.

On top of this, Finsbury itself is trading at a 7.3% discount to NAV. There’s also a 2.8% dividend yield.

Given the potential for turnarounds at key holdings like Diageo, Experian and Sage, I think the trust’s worth considering near 725p.

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There’s another Baillie Gifford investment trust that has done far better this year however. Believe it or not, shares in this trust are already up close to 25% in 2026.

Focused on exciting private companies

The investment trust in focus today is the Schiehallion Fund (LSE: MNTN). This is an under-the-radar product that invests in private growth companies (yet can hold on to them once they go public).

Its aim is to generate capital growth for investors through long-term minority investments in later-stage private businesses that are considered to have ‘transformational’ growth potential (and have the potential to become publicly traded).

It’s certainly done this recently – over the last year it’s returned about 55% in US dollar terms.

Today, it’s invested in some well-known private companies. Among the 10 top holdings at the end of January were Elon Musk’s space company SpaceX, TikTok owner Bytedance, data analysts specialist Databricks, and AI powerhouse Anthropic.

At present, the trust trades for around £1.31 (it trades in US dollars). That means that £1,000 buys roughly 760 shares.

A lot of potential

Is this trust worth considering for a portfolio as a growth investment? I think so.

What I like about this product is that it’s essentially a private equity (PE) investment but with far more liquidity than a traditional PE fund. Unlike a traditional PE fund, where your capital is typically locked up for seven to 10 years, shares in this trust can be traded five days a week just like regular stocks (and held inside a Stocks and Shares ISA or SIPP).

​​I also like the holdings. Other names in the portfolio at the end January included UK digital bank Revolut, international payments specialist Wise (which is a public company these days), and self-driving vehicle company Nuro. So there are some really exciting names here.

Note that a number of the trust’s holdings, including SpaceX and Anthropic, are expected to come to the market via Initial Public Offerings (IPOs) this year. If shares in these companies were to shoot up post IPO (which I think is highly likely), this trust could do well.

One other thing to note is that a lot of top growth companies today are choosing to stay private for longer. Databricks (founded 2013) and Revolut (2015) are good examples here. Via the Schiehallion trust, investors can get access to these types of world-class companies, unlocking new sources of return while simultaneously diversifying their portfolios.

An investment opportunity?

Now, this is a higher-risk product, because the valuations of private growth companies can fluctuate significantly.

Note that when interest rates jumped in 2022, its share price was hammered as valuations on growth companies came down. Another rise in rates is a risk to consider.

I believe the trust’s worth a look though. A small position could pay off in the long run.

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Unfortunately, the reusable rocket pioneer has chosen to stay private. That’s because founder Elon Musk didn’t want its ultimate mission — to establish interplanetary life for the first time in 4bn years of Earth’s history — to be distracted by Wall Street’s myopic quarterly targets.

However, that looks set to change soon, with reports saying that SpaceX is looking to go public in June. Apparently, this would coincide with Jupiter and Venus appearing exceptionally close together in the night sky, as well as Musk’s 55th birthday.

So will I buy SpaceX stock once it lists? Let’s discuss.

Do I understand the business?

To start, let’s briefly look at how SpaceX makes money. This should be the first thing long-term investors consider, because if the way a company generates cash is too complex, it’s usually better to move on.

As legendary investor Peter Lynch perfectly put it: “Know what you own, and know why you own it“.

SpaceX makes money from three main sources. Commercial satellite operators pay it to put their stuff in space via its Falcon 9 rocket. In 2025, the firm carried out an incredible 165 launches with this workhorse rocket, averaging out at roughly one every 2.2 days. This was more than the rest of the world combined!

SpaceX also has NASA contracts in place for the Artemis Moon Lander and restocking the International Space Station.

Thirdly, the company has a satellite internet business (Starlink). With around 9,500 satellites in orbit and more than 9m customers, Starlink’s the largest and fastest-growing segment. It’s now providing high-speed Wi-Fi for major airlines and cruise fleets, and is entering the UK broadband market.

Another part of Starlink is Starshield, a defence-related network for military communications and Earth observation.

Finally, if SpaceX gets its gigantic Starship rocket working reliably, this would be transformative for both satellite deployment and planetary exploration.

Astronomical valuation

According to reports, SpaceX generated around $15.5bn in revenue last year. I can’t find a reliable source about profit margins, though we know that the firm has been cash-flow-positive for some time.

SpaceX is reportedly looking for a valuation as high as $1.5trn! Even if the firm achieved its projected 2026 revenue target of $22bn-$24bn, that would suggest a massive premium on a price-to-sales basis.

Looking at these numbers, I fear the stock will be wildly overvalued, especially if it takes off after the IPO.

Alternative route

There are other ways to get exposure though, including through Schiehallion Fund (LSE:MNTN). This UK-listed trust invests in private companies, with SpaceX making up 14% of assets as of 15 December.

What I like here is that Schiehallion holds other unlisted businesses that could go public this year, notably Databricks. It also has stakes in high-quality stocks such as Wise and Affirm, as well as TikTok owner ByteDance. I find this diversification attractive.

That said, if SpaceX’s IPO was a flop, this could impact performance. And other portfolio holdings might disappoint along the way.

However, on balance, I think this fund is worth considering for those wanting SpaceX exposure. It’s currently trading bang in line with its underlying value, suggesting it’s not wildly overvalued.

The post Is SpaceX a stock to buy for my ISA in June? appeared first on The Motley Fool UK.

At $1.34, the stock’s currently at a 52-week low. Yet I think this is still a strong candidate for inclusion inside a portfolio in 2026. Here’s why.

Eclectic portfolio

Schiehallion invests in later-stage growth companies that are still privately held. It specifically looks for those with “proven products and the transformational potential to disrupt markets or create new ones“.

This has seen it build quite an eclectic portfolio, with holdings ranging from rocket disruptor SpaceX to Databricks and UK self-driving car start-up Wayve. The latter is working with Nissan and is reportedly close to securing $500m of funding from Nvidia.

Once its portfolio companies go public, Schiehallion prefers to keep holding (or even buy more shares). The aim here is to capture more of the life cycle of a company, which is rather different from other funds that cash out when their holdings go public.

This is why we see listed stocks like fintechs Wise and Affirm, which were both unlisted when Schiehallion first invested in them.

The most transformative companies of our generation are choosing to mature in private ownership, building their long-term growth stories away from the quarterly rhythms of public markets. Schiehallion gives investors access to this rich universe of innovation — the missing pieces to complete a growth portfolio.
Fund manager Peter Singlehurst.

Potential IPOs

One reason I’m bullish here is that a couple of key holdings might go public next year. As such, I reckon more investors could buy shares in this trust as a way to get exposure to these businesses.

Without doubt, the biggest IPO would be SpaceX, which makes up 14% of assets. In recent days, it’s been widely reported that the space exploration giant’s looking to go public in 2026.

We don’t know at what valuation, but there have been various figures ranging from $800bn to $1.5trn. Either way, this would be a significant coup for Schiehallion, which has held SpaceX shares since launch in 2019.

SpaceX’s fastest-growing business is Starlink, the internet service that runs off 9,000+ low-orbit satellites. It now has over 8m active customers, with plans for a direct-to-mobile service.

SpaceX also plans to build and put data centres in space, as well as one day colonise the Moon and Mars. Whether it ever does these things, of course, remains to be seen.

Another interesting company is Italy’s Bending Spoons. This is a largest holding, with a meaty 15.6% weighting back in November.

Bending Spoons buys consumer apps then improves and monetises them (it most recently acquired AOL and Vimeo). The tech firm’s CEO has said it could also go public in 2026. 

Big discount

Of course, the flip side to this is that these IPOs could flop, sending Schiehallion’s share price down further in the process. And given the focus on unlisted assets, this is definitely higher risk than most other investment trusts.

However, the shares are currently trading at a very wide 23.4% discount to net asset value. As such, I think they’re worth checking out, particularly for investors who are interested in getting in on SpaceX pre-IPO.

The post 1 investment trust from the London Stock Exchange to check out in 2026 appeared first on The Motley Fool UK.

Staying private

One of the big trends over the last decade has been companies choosing to stay private for longer. This is depriving retail investors of the chance to put their money behind some of the greatest growth businesses of our time.

Just look at game-changing enterprises like SpaceX, TikTok-owner ByteDance, and OpenAI, the firm behind ChatGPT. None of these have gone public, but are each now worth more than the FTSE 100‘s largest company (AstraZeneca).

By the time they do list, their hyper-growth days will be behind them. The people making the big money will be institutional investors, not regular stock-pickers who have previously generated fabulous returns through the likes of Amazon, Nvidia, and Tesla.

Reasons

The reasons for this are threefold. First, unicorns can readily access capital in the private markets (they’re awash with cash).

Second, because of this, they don’t need to expose themselves to the pressures of meeting Wall Street expectations every 12 weeks. Management teams can instead focus on investing for the long term.

Finally, booming secondary markets allow employees and early investors to sell shares to approved buyers. No need for an IPO exit.

Enter Schiehallion

Schiehallion Fund (LSE:MNTN) went public in 2019 to give investors an option. It takes stakes in private growth companies, but then aims to stay invested when they go public. This is designed to capture more of the life cycle of a business.

This is why you see listed names like money transfer provider Wise and health-tech disruptor Tempus AI still in the portfolio. Buy now, pay later (BNPL) firm Affirm is also in there. It appears to have a long runway of growth ahead as more cash-strapped consumers adopt BNPL.

Over the past year, shares of Wise, Tempus AI, and Affirm are up 60%, 49%, and 87%, respectively. And top unlisted holdings like SpaceX, self-driving software start-up Wayve, and Databricks have been doing well. The latter was valued at more than $100bn in its latest funding round.

Top 10 holdings

IPOs are coming

Now, Schiehallion is basically flat since IPO because 2022 saw a big reset in the value of growth companies. This could always happen again.

Meanwhile, the shares are also trading at a stubborn discount to net asset value (currently 25%). And there’s always a risk this discount could widen.

However, there are signs things are improving. One holding — US neobank Chime — went public in June. And management reckons several more are on the way as the IPO market warms back up.

Consequently, Schiehallion is starting to recover (up 47% in a year).

Looking forward, we believe that the pieces are coming into place for a fantastic period for private growth equity investors…Valuations have reset and are still below public market equivalents. This makes us very excited about the progress of our portfolio companies and our pipeline of opportunities for the rest of 2025 and beyond.

Schiehallion Fund

Given the pace at which artificial intelligence is progressing, the trust should have loads of investing opportunities. I think it’s well worth considering for growth investors today.

The post 1 top investment trust to consider from the London Stock Exchange appeared first on The Motley Fool UK.

Here, I want to highlight two that are unique. I think both could be candidates to research for inclusion in an ISA.

Private companies

The first is Schiehallion Fund (LSE: MNTN), run by asset management giant Baillie Gifford.

As well as having a funny name (after a Scottish mountain), the differentiating factor here is that the trust invests only in private growth companies. Then it holds onto them when they go public (most other funds like this exit their positions upon IPO).

The aim of doing this is to capture the full life cycle of growth companies, from late-stage private to (hopefully) public juggernaut.

The late-stage bit’s worth highlighting, as Schiehallion isn’t investing in basement start-ups. These are companies with established products/services and already generating revenue.

A quick glance at the top 10 holdings shows this to be the case. Rocket pioneer SpaceX is valued at $350bn while analytics firm Databricks’ latest funding round puts it at a $100bn valuation.

Stripe’s current valuation is $91.5bn and TikTok owner ByteDance is even higher (around $350bn). Schiehallion offers investors exposure to these types of game-changing unlisted firms.

Top 10 holdings (as of 31 July 2025)

There are risks with this strategy, of course. One of its larger holdings, Swedish EV battery maker Northvolt, recently went bust. And another, writing assistant software firm Grammarly looks like it could face disruption from generative artificial intelligence (AI).

It’s worth mentioning that the shares trade in US dollars, meaning investors are exposed to some foreign-exchange risk. However overall, I’m bullish on this trust long term. The shares, which are priced at $1.25 each, are trading at a 16% discount to the calculated net asset value (NAV).

Hedge fund

The second trust is Pershing Square Holdings (LSE: PSH), which is a member of the FTSE 100. Pershing’s run by outspoken hedge fund manager Bill Ackman, who has a tremendous long-term record of outperformance.

The share price is up 117% in five years, before dividends.

Ackman’s been busy this year, adding both Uber and Amazon to the portfolio. The good news for Pershing shareholders is that these top-tier tech firms were picked up for a much lower price than the current level. Amazon, for example, was acquired in April when it was trading at its cheapest valuation ever.

Now, the main risk here is that the portfolio’s extremely concentrated, with just 11 stocks. In fact, Amazon, Uber and asset manager Brookfield alone make up nearly half the portfolio!

This can turbocharge returns when things go well, but it can magnify losses when stock picks go wrong. And while extremely talented, Ackman is only human and makes mistakes, like all investors.

However, the shares are trading at a whopping 30% discount to NAV. And with market volatility likely to increase later this year when the full global impact of tariffs is felt, I think Ackman will have opportunities to exploit.

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However, there’s now an abundance of venture capital, private equity, and sovereign wealth fund investment. Consequently, top growth firms can raise billions privately without dealing with the regulatory hassle and short-termism of public markets.

Some unlisted companies that have grown enormously in recent years include SpaceX and TikTok owner ByteDance. When they were most recently valued, these enterprises were both worth about $350bn! That would make either of them the largest company in the FTSE 100 by some distance!

One sad outcome of this trend is that everyday investors are missing out on the eye-popping growth of such exciting businesses. I’ve been wanting to invest in SpaceX directly for years, but haven’t been able to.

Assuming SpaceX would now command a similar public valuation, I’ve missed out on 10 times my money. That’s how much its valuation’s gone up by in the past eight years.

Taking a different route

One way investors can gain exposure to the ongoing growth of these two firms is through Schiehallion Fund (LSE: MNTN). This strangely named investment trust — named after a Scottish mountain — has large positions in both SpaceX and China’s ByteDance.

Schiehallion seeks to generate capital growth through investments in later-stage private businesses it thinks have transformational growth potential. It then tends to hold onto these growth firms even after they become publicly traded.

The shares are up around 19% over the past year, but still trade 60% below the price they reached in late 2021.

Strong portfolio

At the end of May, SpaceX and ByteDance made up 9.1% and 8.3% of the portfolio respectively. But an Italian app developer called Bending Spoons is actually the largest holding today, at 10.9% of assets.

Looking elsewhere in the portfolio, there are some top growth stocks in there. Ones that stand out to me are digital payments processor Stripe and Databricks, a global data analytics and artificial intelligence (AI) company.

British autonomous driving company Wayve is also interesting, as it’s due to start trials of self-driving cars in London with Uber next year. It could have a long runway of growth ahead as robotaxis go mainstream over the next decade.

As mentioned, Schiehallion also looks to keep holding shares when its investments enter public markets. Some that have done so include Tempus AI and fintechs Affirm and Wise. These have done really well recently, especially Tempus, whose shares have doubled in six months.

Attractive discount

Naturally, some of the firms in the portfolio aren’t guaranteed to do well. One of its holdings — Sweden’s Northvolt — even went bust recently. The fund’s also denominated in US dollars, so there’s potential currency risk.

Meanwhile, there’s uncertainty with TikTok in the US, where ByteDance might have to sell it. Some fear SpaceX could miss out on government contracts due to founder Elon Musk’s rift with President Trump.

Despite these risks, I think Schiehallion shares are worth considering. At $1.17 each, they’re trading at a sizeable 16.4% discount to the underlying net asset value of the fund.

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However, UK investors can get exposure to SpaceX through investment trusts. One that I think is worth considering for a growth portfolio is Schiehallion Fund (LSE: MNTN), whose top holding is SpaceX.

The quirky-sounding fund is named after the Schiehallion mountain in Scotland and currently has a $922m market-cap. It’s managed by Baillie Gifford, the asset manager best known for running Scottish Mortgage Investment Trust.

Unlike other investment trusts, Schiehallion aims for capital growth by investing in later-stage private businesses that it considers to have “transformational growth” prospects and the potential to become publicly traded. In other words, not start-ups in basements. A handful of holdings have already gone public.

While the share price has risen 34% over the past two years, it remains 70% off a peak reached in late 2021.

Strong year

On 26 March, the trust released solid results for the year to 31 January. The net asset value (NAV) return was 12.9%, while the share price increased 51%.

In the period, the share price discount to NAV narrowed from 39.6% to 19.2%. Perhaps the 5.2m shares it bought back at a cost of $4.2m helped (the fund is denominated in US dollars).

Schiehallion enjoyed a very strong final quarter of its financial year. This was driven in part by SpaceX’s valuation reaching a mammoth $350bn, making it the most valuable private company in the world. 

It first invested in SpaceX in 2019, meaning it has generated a more than six times return over that period. When I hear that, I think that’s a 500%+ return I’ve missed out by not being able to buy SpaceX shares myself!

Other private contributors to performance included Bending Spoons (+89%), which is an Italian consumer app acquirer, and Chinese TikTok owner ByteDance (+33%). I’m not familiar with the former, while everyone has heard of the latter, for better or worse.

Among public holdings, there were strong share price increases from Affirm, Wise, and Warby Parker.

The top 10 holdings have been growing revenue at 42% on average, with a healthy 58% gross margin profile. Roughly 40% of the portfolio is profitable on an EBITDA basis.

Top 10 holdings (January 2025)

Risk

Now, it wasn’t all positive. One holding, Swedish battery maker Northvolt has gone under. Another, German real estate agency McMakler is also facing great difficulties.

Both holdings saw their valuations almost fully written down, which highlights the inherent risks of investing in developing growth companies. That said, more than 80% of the private firms within the portfolio have a cash runway of more than two years. That’s encouraging to know.

Nevertheless, Schiehallion is only suitable for risk-tolerant, long-term investors.

Foolish takeaway

Since the end of February, the share price has plunged 25% to $0.89 (69p). This means the NAV discount has widened to 31%, which I think offers a potentially attractive entry point.

Looking forward, Schiehallion’s managers are excited at the opportunities out there. And they say SpaceX has “arguably one of the most robust competitive advantages we have ever seen“.

Finally, the ongoing charge is 0.92%, which is reasonable.

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In fact, with the right investments, an individual can construct a decent-sized pension investing £700 a month. Here’s how a 40-year-old could do that, even when starting from scratch.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Considering portfolio risk

The first thing to note here is that stock markets can be volatile and unpredictable. And while the market goes up over time, it certainly doesn’t do so in a straight line!

That said, some shares are far less volatile than others. With thoughtful planning, it’s possible to build a portfolio that spans multiple sectors and includes a mix of growth stocks, dividend shares, funds, and trusts. These could comprise both UK and US shares.

This diversification helps smooth out market fluctuations, reducing the risk of being overly exposed to a single geography or sector, like technology or energy.

I reckon 15-20 different investments is a good target to aim for when starting out.

Looking at the rate of return

The S&P 500 has long outperformed the UK’s FTSE 100, delivering a 12% average return a year versus the latter’s 7-8%.

However, there’s no guarantee that will happen every year. UK stocks might have a purple patch, while investors sour on those listed in the US (on the grounds of overvaluation, say).

By investing in both markets though, I think it’s entirely possible to aim for a 10% average return over the long run. This is the ballpark figure for global stocks.

For a 40-year-old starting out, it means investing £700 a month at this rate of return would result in an ISA worth £1.18m after 28 years. This assumes reinvested dividends and a State Pension age of 68.

According to Vanguard, a single retiree who qualifies for the full State Pension would need £488,688 in pension savings to afford a ‘moderate’ retirement, as defined by the Pensions and Lifetime Savings Association. So £1.18m would be a fantastic outcome.

A fund aiming for mountainous returns

There are many shares an investor can buy to achieve these returns. Those starting out might want to consider Schiehallion Fund (LSE: MNTN).

This is an investment trust that backs fast-growing private companies. But rather uniquely, it then keeps holding the shares once they’ve gone public, aiming for outsized returns.

Today, there are around 44 stocks in the portfolio. They offer exposure to exciting areas that are tipped for massive long-term growth.

Top 10 holdings (as of 30 November)

One thing to consider here is that the managers aren’t guaranteed to get it right every time. As an example, the fund lost money in 2024 on an investment in Northvolt, a Swedish EV battery maker that went bust. It can’t afford more such high-profile failures or its performance/strategy will come under fire.

However, the shares remain 63% off their 2021 peak, while trading at a 16% discount to the fund’s net asset value. I think Schiehallion could deliver market-beating returns from here, especially once the IPO market starts heating up, potentially as soon as 2025.

The post If a 40-year-old puts £700 a month in a Stocks & Shares ISA, here’s what they could have by retirement appeared first on The Motley Fool UK.