Best-selling funds, Investment Trusts and ETFs of May 2026

Global stock markets shook off worries over the intractable Middle Eastern conflict and spikes in inflation data, preferring to focus on the potential gains from artificial intelligence. It was another strong month for AI infrastructure stocks, particularly semiconductor groups, which are now sitting on gains of almost 100% for the year to date.

A resolution to the war in Iran looks as elusive as it did at the end of April. Persistent reassurances from the White House that an agreement is imminent have not materialised. The Strait of Hormuz remains firmly shut. Nevertheless, despite warnings that the global oil market is nearing a crunch point as countries exhaust their reserves, the oil price has moved marginally lower over the month – settling at around $93 a barrel.

Share prices have been supported by the resurgent AI sector. Strong earnings announcements from bellwether groups such as Nvidia gave confidence that AI demand was intact. The S&P 500 rose 5.2% over the month[1], with the MSCI World up 4.6%. Emerging markets continued their extraordinary run higher, rising 9.7%. They are now up more than 50% over the past 12 months alone.

Emerging market strength also has an AI flavour to it. Asian AI infrastructure companies have powered indices higher. In particular, the Taiwanese and South Korean markets saw another month of strong gains, up 15%[2] and 25% respectively[3]. Latin America had a weaker month as commodity prices eased back[4].

UK markets were less exciting, with the FTSE 100 rising just 2% over the month[5]. The ongoing political turmoil in the UK may have deterred sensitive international investors, but the real problem was that the market was focused on a single narrative – AI – in which the UK stock market has limited participation. The FTSE 250 fared slightly better, rising 4.3%.

Bond markets were initially stable after the tumult of the previous two months. However, unsettling US inflation data saw the US CPI rise 3.8% year on year, led by gasoline prices. It made a rate cut look vanishingly unlikely and even brought a rate rise into prospect. The US 10 year treasury yield moved higher over the month as a result.

The UK 10 year gilt moved marginally lower over the month, having spiked higher in the aftermath of the local elections and speculation over the future of Prime Minister Keir Starmer. However, by the end of the month, some stability had been restored, and an immediate challenge to Starmer temporarily deferred. 10 year bond yields moved lower, though they remain some way from their level in February.

By the end of the month, the Iran crisis rumbled on, but markets appear to be growing increasingly habituated to the disruption. There is considerable speculation around the IPOs coming to market over the next few months and their likely impact on markets. The bull market is still going, but there are potential fragilities.

Investors rediscovered their enthusiasm for technology in May, with the L&G Global Technology appearing as a best-seller on all four platforms. The fund has exposure to the world’s largest global technology funds, with 15% exposure to Nvidia, alongside other semiconductor groups such as Broadcom, TSMC and Micron.

There is a question market over whether this type of broad-based technology exposure will work as effectively in future. The ‘winners’ from the AI revolution appear to be coalescing around a relatively narrow band of AI infrastructure companies and while generalised technology indices have exposure to those names, they also have exposure to some of the potential ‘losers’ – such as the large software groups. Investors will need to grapple with this over the coming months. There were signs that some investors preferred an active approach, with the Fidelity Global Technology and Polar Capital Global Technology funds also appearing.

The other two most popular funds were the Vanguard FTSE Global All Cap index and the FTSE Index World funds, as has been the case in recent months. These funds tend to have higher weightings in the US and in the technology sector, so have benefited from the resurgence in technology companies over the past month.

Apart from the two technology funds, the other two popular active funds were the Fidelity Global Dividend and Artemis Global Income. This was the same as last month. The Lazard Emerging Markets fund also made an appearance, but given the recent performance of emerging markets, the absence of any other emerging market funds was surprising.

There are still some nervous investors out there, with the Fidelity Cash fund the top seller on the Fidelity platform. The Royal London Short Term Money Market Fund also appeared on the Fidelity and ii funds showing that some investors still believe there is reason for caution in the current environment.

Investment Trust investors had a clear favourite this month – Scottish Mortgage. It was the top selling trust on every platform. The reason may well be the upcoming SpaceX IPO. Scottish Mortgage has a large stake and should make a tidy profit if the deal launches successfully. The Trust also holds Anthropic, one of the world’s leading AI labs. This is also likely to IPO in the coming months.

SpaceX is not the only futuristic investment catching investors’ eyes this month. The Seraphim Space Investment Trust was a bestseller on all four platforms. It has been in the spotlight after launching a £350m ‘C’ class offer to existing shareholders to capitalise on the ‘space boom’. The Trust, which invests in private satellite companies, is up an eye-catching 574% over three years. Polar Capital Technology also proved popular.

The other two Trusts that appeared on all four platforms were the steadier options of City of London and JPMorgan Global Growth & Income, showing that investors still have a place in their portfolios for less glamorous investment trusts.

Elsewhere, there was an eclectic mix of international Trusts. Emerging markets were a theme, with the JP Morgan Emerging Markets Growth & Income on the AJ Bell platform, Schroder Oriental Income on the Fidelity platform, and Henderson Far East Income on ii.

After a period of popularity in the wake of the Iran crisis, Greencoat Wind slipped off investors’ radar this month. It only appeared on two platforms – HL and ii – having appeared on all four in previous months. While the Iran crisis is likely to refocus investors back on alternative energy options, it hasn’t yet led to a discernible revival in performance for the sector.

There was a note of caution creeping into ETF holdings in April. The Amundi Smart Overnight Return UCITS ETF – a money market fund linked to money market rates – appeared on the ii and Fidelity platforms, suggesting investors were feeling more cautious about the direction of markets. The iShares £ Ultrashort Bond UCITS ETF also suggested investors were looking for more cautious options.

The enthusiasm for gold and silver has also sagged as the prices for both metals have slipped. Gold ETCs still appeared on all four platforms, but in fewer numbers than at the start of this year. Gold has not hedged portfolios as hoped in the recent sell-off.

S&P 500-focused ETFs, including the USD and GBP versions of the Vanguard S&P 500 ETF remained top sellers across all platforms. The stronger performance of the US markets after a lacklustre start to the year will have been welcome. Technology was also popular. VanEck Semiconductor featured on three of the four platforms, as investors started to prioritise the infrastructure companies benefiting from AI.

The defence and aerospace ETFs were notably absent from the best-seller list this month. The sector lagged the major indices in April, and investors may have decided that it has run far enough for the time being.