Man Group Guaranteed Capital Product Raises $365m

by Carla Johnson, Investors Offshore, London

09 January 2003

Man Group announced that its most recent launch, Man Multi-Strategy Series 4, has raised the equivalent of $365 million of client money. The Series 4 approach provides access to multiple investment strategies, many of which have relatively low correlation to traditional assets representing some of the key hedge fund style groups. The product carries a capital guarantee from the Royal Bank of Scotland to return at least 120% of subscribers’ initial investment at maturity.

Man Multi-Strategy Series 4 Ltd was available to investors from 28 October to 6 December 2002. The next global launch of a structured product will be Man Multi-Strategy Series 5 Ltd, which will be open for investment on 10 February 2003.

Series 4 is targeting medium-term annualised growth of around 15% while aiming to restrict volatility to around 10% and was available in both US$ and Euro Class Bonds. What separates this product from the previous products in the Man Multi-Strategy family of products is an enhanced principal protection structure - Series 4 guarantees investors a return of at least 120% of the Face Value of their initial investment at maturity.

Series 4 provides investors with access to a diversified portfolio of investment strategies implemented by a number of carefully selected advisers. The ability of the Man Multi-Strategy portfolio to generate returns and protect investors' capital during difficult market conditions for traditional assets has been highlighted by the performance of Man Multi-Strategy Guaranteed Limited, the first product in the family. As at 31 July 2002, Man Multi-Strategy Guaranteed Limited had substantially outperformed traditional investments, producing an annualised return of 14.9% since inception - compared to -20.3% for world stocks and 6.3% for world bonds over the same period.

Series 4 incorporates an enhanced principal protection structure that guarantees investors the return of at least 120% of the Face Value of their initial investment at maturity. In addition, provisions have also been made to include a Profit Lock-in Feature which, subject to trading performance, has the potential to elevate the level of the Guarantees at maturity by locking-in a portion of net new trading profits following periods of sustained profitability. The operation of both the Guarantees and the Profit Lock-in Feature are subject to the terms and conditions of the capital guarantees provided by The Royal Bank of Scotland plc.

Man Investment Products is part of Man Group plc, a leading international financial services business that is listed on the London Stock Exchange and is a constituent of the FTSE 100 index of leading shares. The Royal Bank of Scotland plc, a leading UK-based financial institution, is the second largest banking group in Europe and the fifth largest in the world, with a market capitalisation of £49 billion at 22 February 2002. It has more than 18 million personal customers and 2,287 branches in the UK. As at 31 December 2001, its assets were £368 billion and as at 17 July 2002 had a Aa1 senior debt rating from Moody's.

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