Truetide plc (LSE:TRUE) is seeking shareholder approval for a substantial expansion of its investing policy that would introduce a dedicated artificial intelligence strategy alongside its existing focus on technology and knowledge-intensive businesses.
The proposed changes follow a review of developments across the AI market. Truetide’s board sees an increasingly clear distinction between established, cash-generative companies using AI to strengthen their businesses and heavily funded growth companies whose elevated valuations may prove more difficult to sustain.
New strategy combines long positions with defined-risk shorts
Under the revised policy, Truetide intends to construct a diversified global portfolio combining long investments in companies that enable or benefit from AI with defined-risk short exposure.
Any short exposure would be established exclusively through purchased options, limiting potential losses to the premium paid rather than exposing the company to the unlimited downside associated with conventional short selling.
The strategy would be funded using available cash and proceeds from the orderly disposal of investments considered non-core to the revised portfolio.
Truetide believes the approach could improve risk-adjusted returns while giving the company greater flexibility to benefit from both rising and falling valuations within the rapidly developing AI sector.
Investment limits and hedging rules to be formalised
The proposed policy also introduces clearer risk controls covering individual portfolio positions and the amount that can be committed to option premiums.
It would formally establish the company’s ability to use hedging techniques and protective collars, providing additional tools for managing downside risk while retaining exposure to potential gains.
Alongside the new global AI strategy, Truetide would retain its existing approach to investing in UK-focused technology and knowledge-intensive businesses at both earlier and later stages of development.
General meeting scheduled for September
Shareholders will vote on the revised investing policy at a general meeting scheduled for 7 September 2026.
The meeting will consider a single resolution approving the changes, which require shareholder consent under AIM rules governing material amendments to an investing company’s policy.
If approved, the new strategy will become effective immediately. It would broaden Truetide’s potential investment universe across international markets while maintaining governance restrictions covering gearing, cross-holdings and the financial instruments available to the company.
Financial performance remains a challenge
Truetide’s investment outlook continues to be constrained by weak financial performance, including declining revenue, persistent operating losses and continued cash consumption. These pressures are partly mitigated by relatively low levels of debt.
Technical indicators present a mixed picture, with a positive MACD countered by softer short-term momentum and neutral-to-weak RSI readings. The company’s loss-making position also results in a negative price-to-earnings ratio, while the absence of a dividend yield provides little additional support from an income perspective.
More about Truetide plc
Truetide plc is an AIM-quoted investing company targeting opportunities across technology and knowledge-intensive industries, including healthcare and professional services.
Its strategy covers listed and privately held companies at different stages of development, using equity and related financial instruments. The company can operate as a passive shareholder in undervalued listed businesses while taking a more active role in earlier-stage private investments, including representation on investee company boards.
Truetide may also invest in restructuring, rescue or distressed situations where the board identifies opportunities to create value. Investments are generally made with a potential growth and exit horizon of between two and five years.
The company can invest through intermediate entities and partnerships and may use its own shares as consideration for transactions, subject to cross-holding restrictions. Its investment framework is also structured to maintain appropriate separation from controlled investee businesses and preserve Truetide’s status as an investing rather than trading company.
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