It’s no secret that Rolls-Royce shares have massively outperformed the FTSE 100 over the last few years. Yet recent gains have understandably started to moderate, with the stock actually down 2% in the past six months.

Still, a one-year return of 44% is not to be sniffed at — it’s more than double the Footsie’s total return of about 20%. And the five-year share price chart is still a thing of beauty.

Spacetech trust

But there’s an under-the-radar UK stock that has done much better over the past 12 months. Meet Seraphim Space Investment Trust (LSE:SSIT), which has rocketed from 55p to 137p in this time (a 149% gain).

As suggested by the name, this investment trust focuses on the space sector. Predominantly this is early and growth-stage firms in space technology, which is widely pegged as a multi-trillion-dollar market in the making. We’re talking rockets, satellite manufacturing and communications, earth observation, and so on.

Spacetech has both commercial and sovereign defence applications, including space-based reconnaissance. And the European defence boom has helped propel the trust in recent years (it’s up more than 400% since June 2023).

European governments, led by Germany, have moved decisively from policy intent to implementation as they seek to reduce longstanding reliance on the US for critical defence capabilities…This continues to produce good tailwinds for [our]portfolio.
Seraphim Space Investment Trust

Strong action

At the end of 2025, the portfolio contained 23 companies and one fund investment valued at £331.6m (up from £259.8m in June 2025). Meanwhile, net asset value (NAV) per share increased by 20.1% to 142.3p in the last six months of 2025.

It ended the year with £22.1m in cash and no debt. And a milestone was reached as the fair value of its private portfolio (after disposals) exceeded 200% of cost for the first time since launch in July 2021.

Inevitably, not all holdings in a fund like this will succeed. The aim is for a handful to really take off and become market leaders, driving the trust’s NAV higher for years to come.

For a successful example of this, look at 3i Group from the FTSE 100. Its stock has more than doubled in five years due to the extraordinary rise of Action, the Dutch discount retailer in which it has a majority stake.

Seraphim Space Investment Trust’s version of Action appears to be ICEYE, a Finnish microsatellite company that uses radar to see through clouds, smoke, and even total darkness.

Needless to say, that’s pretty handy technology for military purposes, leading German defence giant Rheinmetall to join forces with ICEYE. This joint venture secured a massive €1.7bn contract with the German armed forces last year, and is currently helping Ukraine.

However, much like 3i Group with Action, a chunky 39% stake in ICEYE risks becoming a concentration problem. For example, it could fall out with Rheinmetall, leading to a dissolution of the venture.

Massive booming market

Looking ahead, the planned blockbuster SpaceX IPO later this year is likely to whet venture capitalists’ appetite for the next SpaceX-style start-ups. So the trust’s portfolio holdings should remain well-funded.

Weighing things up, I think the trust is worth considering, at least as a smallish holding in a diversified portfolio. At 137p, it’s trading slightly below the latest NAV per share calculation.