Japan - case study

Strength through relationships

Man is a leading provider of alternative investments to Japanese investors, specialising in marketing products mainly through joint ventures with leading financial institutions.

Profile of Japanese investors in Man products

Our investor base comprises private investors, pension plans and financial institutions. To achieve maximum effectiveness in each of these market segments, Man's Japanese business teams up with leading distributors, securities brokers and banks in the private investor markets; trust banks for pension plans; and banks, securities brokers and discretionary investment advisers for financial institutions.

Why do investors choose Man products?

Japanese investors generally have been strongly risk-averse in recent years and accustomed to minimal yields on cash deposits, with more than half of household savings held in very low interest bank deposits or cash. Although turmoil in the financial markets has temporarily dampened the trend, we expect a long-term shift from bank deposit to risk investment.

Other factors that play strongly in reassuring Japanese investors about Man include the long history of the business, its stability, its very substantial funds under management and superior performance.

What is unique about our business in Japan compared to our competition?

The uniqueness of Man's Japanese business can be summarised as follows:

1) Covers all key client segments such as private investors, pensions and financial institutions with a highly experienced team of local staff.

2) Business leverage primarily through joint ventures with key distributors in each client segment.

3) Emphasis on post-investment satisfaction by offering high-level client service such as regular reporting, pro-active response to clients and performance reporting sessions for private investors.

Key growth opportunities

The long-term trend toward greater risk exposure in financial investment markets presents the potential for multi-billion dollar growth in alternative investments from private investors alone. To participate fully in the expected growth it is vital to support and educate distributors and investors.

As in other regions, managed futures have been a very popular area during the financial turmoil because of strong, non-correlated performance and this should continue, while stronger performance is awaited from hedge funds in general. We expect to focus on AHL, multi-manager CTA and global macro products in the near term. Longer term, we see good demand for other hedge fund styles and diversified fund of hedge funds.

Pension plans and financial institution business

Good opportunities are evident in the pension plan and institutional sectors. During the financial crisis AHL has provided what can be seen as an insurance effect and it remains very appealing, leading to strong investment flow from pensio plans. AHL has the strong advantage with financial institutions in that it can satisfy the Basel II compliant disclosure requirements.

Shimpei Kanzaki (Marketing)

Japan In brief

Who the investors are

Private investors, high net worth individuals, pension plans and financial institutions.

Average size of investments

Varies according to investor segment, distributor and product. For private investor products targeting the mass affluent market, the average is $70,000-100,000.

Total funds under management

Man's Japanese business accounts for approximately $8 billion (March 2009) of the Group's total FUM.

Sales force

The main role of Man's Japanese sales people is to establish relationships with financial institutions as distributors, propose products, plan marketing strategies, support marketing activities through study sessions and investor seminars, and offer post-investment services. We also selectively and directly promote our products to large financial institutions and cover major institutional clients such as banks, trust banks and insurance companies.

Seminars and study sessions

More than 500 study sessions for distributors, plus investor seminars and performance reporting sessions were held in the 2008/9 financial year.