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On the floor, FTSE 250-listed Man Group (LSE: EMG) isn’t too totally different from the opposite 200-year-old London monetary companies corporations.
It’s an funding administration enterprise, so it goals to develop purchasers’ cash – for a price, after all.
However Man Group is admittedly fairly distinctive and provides a change of tempo for anybody interested by investing within the FTSE 250 inventory.
And whereas the identify may be unfamiliar, the Man Booker prize it sponsored for a few years would possibly ring a bell.
Distinctive alternative
Hedge funds are normally tough to entry for these of us exterior the 1%. A £1m minimal is typical and guidelines out most of us.
Man Group isn’t solely the most important publicly listed hedge fund on the London Inventory Alternate, it’s the most important one on this planet.
And because the identify implies, ‘hedge’ funds can provide safety towards weak inventory efficiency.
If I purchase the shares, I wouldn’t be investing in any of the group’s funds (it has 74 of them) however the total efficiency of the corporate itself.
Whereas a 3rd of the group’s numerous funds make use of typical buy-and-hold methods, two-thirds use ‘quant’ methods.
What it doess
Quant buying and selling takes many types, but when we think about complicated statistical fashions and lightning-fast algorithms then we’re not too removed from the mark.
That’s broadly what it does and I’d must say this may be a one-of-a-kind inventory – however is it an excellent purchase?
Nicely, the shares have soared lately, up 142% since 2020 – top-of-the-line returns on the FTSE 250.
A meaty 5.29% dividend is ready for a 4% rise. Oh, there are buybacks too.
Dividends and capital development all sound good, and there’s a synthetic intelligence play right here too. Administration reckons AI companies may revolutionise their funds’ efficiency.
The group has already created a chatbot it’s calling ManGPT.
Serving to quant merchants discover an edge within the markets is among the extra seemingly advances AI may assist with, I really feel.
Common funds
After all, I’d be counting on these merchants – the group counts practically 1,000 quants and technologists – to carry out.
Final yr, they form of didn’t. Efficiency charges had been down after a disappointing yr for quant methods. CEO Robyn Grew blamed the banking disaster and the November shift within the markets.
Whether or not she’s proper or improper, banking on clean market circumstances looks as if the most important threat right here.
Regardless of that, the funds remained fashionable and belongings below administration went up 17% final yr. The group now offers with $167bn of purchasers cash.
In abstract, the individuality of the inventory together with a beautiful development story appears tempting. I’d purchase Man Group shares at this time if I had any spare money.
