For many investors, the story of artificial intelligence has been dominated by the usual suspects: Nvidia, Microsoft, and Google. Yet, a leading hedge fund believes the market is missing one key player—Atlassian. According to Liontrust Asset Management, the Australian-born software company is far from being an AI laggard. In fact, portfolio manager Vanessa Sinclair argues that Atlassian’s products, particularly Jira, may emerge as critical infrastructure for AI development workflows.
Sinclair, who recently steered her fund through highly profitable calls on Meta and Seagate Technology, is confident that Atlassian’s role in providing traceability, accountability, and auditable trails for AI-driven projects is being underestimated. The market may see Atlassian as a simple “AI-user,” but Liontrust sees a strategic enabler. This contrarian view, if proven correct, could deliver significant upside for investors who are willing to hold through the volatility.
The Seagate Example: How Patience Turned into Explosive Returns
Long-term conviction is at the heart of Sinclair’s investment style. A clear example is Seagate Technology, a stock that many had dismissed due to the decline of traditional hard disk drives in consumer electronics. For years, Seagate traded sideways, a forgotten player in the storage industry. Yet, Sinclair held her position, convinced that the data center revolution would change its fortunes.
That thesis materialized in May when Seagate highlighted how surging AI workloads require massive data storage solutions. The market responded immediately. The stock rocketed more than 250 per cent in 2025, briefly becoming the S&P 500’s best performer. Even after cooling, Seagate remains up over 150 per cent year-to-date. For Liontrust, which first bought shares in 2018, the holding has delivered a 563 per cent return.
This illustrates Sinclair’s philosophy: the market often fails to recognize transformative shifts until they become unavoidable. For her, Atlassian could be the next overlooked opportunity.
Why Atlassian May Be the Next AI Winner
Atlassian has faced a turbulent two years. Its stock has halved since February, and many analysts have written it off as a company with limited AI relevance. Yet, Sinclair believes the market has misread the story. Atlassian’s Jira software, used by millions of developers worldwide, may soon become indispensable for AI projects. Here’s why:
- AI Project Traceability
Companies integrating AI into workflows face regulatory, ethical, and security concerns. Jira’s ability to track every line of code and decision point creates a vital paper trail. - Auditable AI Development
As businesses demand transparency, Jira provides audit-ready logs of AI model updates, reducing compliance risks. - Network Effect Advantage
With thousands of organizations already using Jira, adoption for AI compliance will likely accelerate, reinforcing Atlassian’s dominance. - Resilient Business Model
Unlike consumer-facing firms that rely on volatile advertising revenue, Atlassian’s enterprise subscription model provides stable recurring cash flows.
This combination, Sinclair argues, positions Atlassian to benefit directly from the structural shift toward AI-enabled business processes.
Performance Snapshot of Liontrust’s Global Alpha Long-Short Fund
Below is a snapshot of Liontrust’s performance compared to its benchmarks:
| Fund/Index | 1-Year Return | Annualised Since Launch | Assets Under Management |
|---|---|---|---|
| Liontrust Global Alpha Long-Short | 16% | 8% | $40 million |
| HFRX Equity Hedge Index | 8.5% | 3.8% | Benchmark |
| Liontrust (Firm-Wide AUM) | N/A | N/A | £1 billion ($2.1 billion) |
The fund’s consistent outperformance stems from contrarian stock picks, balanced long/short strategies, and opportunistic moves such as cutting shorts in AI infrastructure ahead of a sector-wide rally.
Market Risks and Contrarian Bets
Despite optimism on Atlassian, Sinclair is cautious on broader tech valuations. Roughly one-third of S&P 500 companies now trade at more than 10 times sales, a level she likens to the late-1990s dotcom bubble. She highlights concerning “circular” cross-investments among OpenAI, Oracle, and AMD as potential signs of overconfidence. For that reason, Liontrust has built a significant short book.
The shorts currently target consumer-facing companies vulnerable to inflation and slowing demand, including fast-food retailers, fast-fashion brands, and online ticketing firms. Meanwhile, long positions in Amazon, Expedia, and Mercado Libre serve as hedges against those bearish bets.
Sinclair also holds bullish positions in gold producers like Newmont, Barrick, and Agnico Eagle, expecting the precious metal to trade “higher for longer.” This diversified approach reflects a strategy of mitigating risks while seizing asymmetric opportunities.
Beyond Atlassian: Other Misunderstood Stocks
Atlassian isn’t Sinclair’s only contrarian call. She also highlights Intuitive Surgical, a robotic surgery pioneer, as another misunderstood asset. Despite a 16 per cent drop this year, Sinclair points to its powerful network effect: each additional surgery adds to a vast dataset that strengthens its competitive edge. Short-term tariff fears have weighed on the stock, but Liontrust remains confident in its long-term potential.
Similarly, Sinclair has not hesitated to walk away from former winners. Earlier this month, the fund exited Meta (formerly Facebook) after a decade of outsized gains, declaring the stock “fully valued.” That disciplined exit mirrors her earlier success shorting WANdisco before accounting fraud wiped out its valuation.
The Big Picture: Technology as a Horizontal Force
Sinclair emphasizes that her fund does not view technology as a standalone sector but as a “horizontal force” cutting across all industries. This perspective allows Liontrust to identify overlooked opportunities, such as data center electrification company Prysmian, which has rallied over 40 per cent this year.
For Atlassian, this philosophy matters. While traditional analysts may box it in as a “software tools” company, Liontrust views it as a systemic enabler of AI governance—a role with far-reaching implications across sectors from finance to healthcare.
Trending FAQ
Why does Liontrust see Atlassian as undervalued in AI?
Because Jira provides traceability and compliance tools essential for AI projects, making it more than just a user of AI—it is a governance platform.
What risks does the hedge fund highlight in today’s market?
Elevated valuations in big tech, circular cross-investments, and consumer demand pressures in the US and Europe.
Which other companies does Sinclair back strongly?
Seagate, Intuitive Surgical, Prysmian, and gold miners like Newmont and Barrick.
What’s Liontrust’s biggest short bet right now?
Consumer-exposed stocks in the US, UK, and Europe, particularly in fast food, fast fashion, and online retail.
How has the fund performed compared to peers?
It has delivered an annualized 8 per cent return since launch, outperforming the HFRX equity hedge index at 3.8 per cent.
By positioning Atlassian as a potential dark horse in AI infrastructure, Liontrust challenges the market consensus. For investors, the lesson is clear: sometimes the biggest opportunities lie not in the obvious leaders but in the misunderstood enablers of transformation.
