Scottish Mortgage Trust - Portfolio Sale

This global investment trust was added to my SIPP portfolio at the start of 2017 at the initial purchase price of 338p. A year later, following a little turbulence in the share price, I added SMT to my ISA portfolio at 415p. 

In May they issued full year results and, in my write-up, I flagged up some concern that Elon Musk's SpaceX had been added to the portfolio. For someone who is concerned about the environment, this was a red light. I subsequently established that this space exploration company was also held in my other BG holding Edinburgh Worldwide and also their recently launched American Fund.

I wrote to Baillie Gifford to express my concerns and from their lengthy response (which I won't bore you with), I concluded that BG were excited about all the potential offered by their holdings and I suspect they will be increasing this across various trusts and funds in their stable.

The Problem for Me

As I understand it, the ultimate goal of companies such as SpaceX is to revolutionise space exploration and enable humans to live on other planets such as Mars. In a bizarre article in the Independent this week, Musk said he wanted to "Nuke Mars" as part of a plan to make the planet habitable with a view to establishing a city and colonising Mars by 2050. Musk suggests that colonising the red planet is essential for our survival.

Musk launches Tesla into space

Of course, Musk is not the only rich entrepreneur engaged in these fantasies. Amazon CEO, Jeff Bezos has Blue Origin which is looking to make space travel more feasible. Our own Richard Branson has recently announced plans to float his Virgin Galactic on the New York stock exchange and be the first business to provide commercial space travel.

You don't need a degree in rocket science to understand the environmental impact of all the emissions generated from these activities. Thousands of test rockets are injecting harmful emissions high into our upper atmosphere which is adding to warming and also depleting the ozone layer over the polar regions.

Jeff Bezos and Blue Origin

I guess a lot of people think it's 'cool' for these billionaire entrepreneurs to try to outdo each other in the race for space dominance. Personally, I think it's just plain stupid and the height of human folly when so much effort is required to prevent global warming and when so many young people are doing everything to address our climate emergency.

These people are spending billions of dollars on finding solutions to living on another planet. I prefer to find solutions to continuing to live on this planet.

To Conclude

So, time to say goodbye to one of my largest global managed trusts.

The sale price was 542p which represents a rise of 17% year to-date. I have had a good run with SMT over the past few years - a total return of 65% on my SIPP investment and 32% for my ISA. I am sorry to have to give it up as my intention would normally be to hold for the longer term. However, for me, profit is not the only consideration and I like to think my investments are making a positive contribution to the world. 

Therefore I just do not feel at all comfortable holding a fund which has SpaceX and possibly similar holdings and certainly do not want to profit from organisations which trash the environment and pollute space with junk just like we fill our oceans with single-use plastics. As they say on Dragon's Den..."I'm Out".

The proceeds will remain in cash for the time being whilst I think about where to reinvest the money and explore other options.

As ever, this article is merely a record of my personal investment decision to sell and should not be regarded as a recommendation - always DYOR!