Stocks and Shares ISA investors have been buying several investment funds in recent months. And popular investment platforms, including AJ Bell and interactive investor, I saw A Scottish mortgage investment fund (LSE: SMT) among the most frequently chosen.

It has fallen somewhat out of favor after reaching an all-time high in tardy 2021. However, it is back in 2026, gaining 20% ​​so far.

The explosive growth of artificial intelligence is partly due to its renewed popularity. Investment fund includes Nvidia, ASML, AmazonAND Meta in its 10 largest holdings. The hope is that spreading investor money among these companies and a wide range of other global stars can reduce risk with a bit of diversification.

Space risk

Well, I’m talking about reduced AI risk. But it comes with a completely different risk. More than 19% of shareholder cash is currently in Space Exploration Technologies – better known as Elon Musk’s SpaceX.

We expect SpaceX to debut on the stock exchange in the next few months through an initial public offering (IPO). People are already talking about a market capitalization of $2 trillion. Until that happens, the Scottish Mortgage Investment Trust is one of the few ways UK investors can get a piece. Is this one of the reasons for the sudden enhance in investor interest in ISAs? It really looks like this.

However, those who buy will also get a share MercadoLibrethe largest e-commerce platform in Latin America. ByteDance, the Chinese company behind TikTok, is also at the top of the rankings. Oh, and Shopifypioneer of global trade, increases attractiveness.

Invest in development?

I would say UK investors see a lot of global diversification here. And it’s not just about jumping on the artificial intelligence and space bandwagon. Despite this, Scottish Mortgage has a very mighty focus on growth. I also think that anyone investing a bit in a stocks and shares ISA should really consider balancing this with a bit of diversification into safer stocks.

So do investors have to pay a growth premium to get in on this activity? Well, in its latest update, the trust put its net asset value (NAV) per share at 1,378p. Based on the share price at the time of writing of around 1,440p, we anticipate a premium to NAV of only around 4.5%.

This does not yet allow for a post-IPO valuation of SpaceX. And to me, that makes the price look like a great value. Especially when the headlines talk about a possible price-to-earnings (P/E) ratio of over 200 for SpaceX after going public.

What to do?

This is by no means a low-risk investment. Even without SpaceX’s exposure, the future of AI valuations is still very much unknown. I would never buy a stock like this to make a quick profit by buying and selling on SpaceX. However, I believe that those looking to take advantage of these electrifying long-term growth opportunities should consider Scottish Mortgage Investment Trust.