<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Marshall Wace is a London-based hedge fund that was started 22 years ago by Paul Marshall and Ian Wace, hence the name Marshall Wace. The fund manages around $39 billion in assets under management. Though located in England, the fund offers additional offices in Hong Kong and New York. Before co-founding the fund with Paul Marshall, Ian Wace, its CEO and CRO, honed his investment acumen at Deutsche Morgan Grenfell, being in charge of Equity and Derivatives Trading. At the same time Paul Marshall, the fund’s CIO, sharpened his investment skills as a CIO for European Equities at Mercury Asset Management. He graduated from St John’s College at Oxford with a BA (Hons) and from INSEAD Business School, with an MBA.” data-reactid=”11″>Marshall Wace is a London-based hedge fund that was started 22 years ago by Paul Marshall and Ian Wace, hence the name Marshall Wace. The fund manages around $39 billion in assets under management. Though located in England, the fund offers additional offices in Hong Kong and New York. Before co-founding the fund with Paul Marshall, Ian Wace, its CEO and CRO, honed his investment acumen at Deutsche Morgan Grenfell, being in charge of Equity and Derivatives Trading. At the same time Paul Marshall, the fund’s CIO, sharpened his investment skills as a CIO for European Equities at Mercury Asset Management. He graduated from St John’s College at Oxford with a BA (Hons) and from INSEAD Business School, with an MBA.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="The fund relies on a combination of investment basics with quantitative and systematic strategies in order to generate the best possible returns to its clients. On its website, the fund reports being “a leading global alternative investment manager specializing in long/short equity” and also the biggest alternative investment management firm with more 240 employees in offices in London, Hong Kong, and New York. Marshall Wace is known for creating the MW TOPS Alpha Capture System as part of its systematic strategy, which is considered the first ‘Alpha Capture’ application in the world. This is a “proprietary system that collects investment ideas from over two hundred sell side institutions and independent research providers, that has resulted in the execution of millions of trades annually. The TOPS architecture allows for global, diversified portfolios with differing risk and trading profiles”. The fund’s fundamental strategies are focused on specific industries and locations, and are aiming to attain stock-based idiosyncratic alpha. In addition, the fund runs several UCTIS funds.” data-reactid=”12″>The fund relies on a combination of investment basics with quantitative and systematic strategies in order to generate the best possible returns to its clients. On its website, the fund reports being “a leading global alternative investment manager specializing in long/short equity” and also the biggest alternative investment management firm with more 240 employees in offices in London, Hong Kong, and New York. Marshall Wace is known for creating the MW TOPS Alpha Capture System as part of its systematic strategy, which is considered the first ‘Alpha Capture’ application in the world. This is a “proprietary system that collects investment ideas from over two hundred sell side institutions and independent research providers, that has resulted in the execution of millions of trades annually. The TOPS architecture allows for global, diversified portfolios with differing risk and trading profiles”. The fund’s fundamental strategies are focused on specific industries and locations, and are aiming to attain stock-based idiosyncratic alpha. In addition, the fund runs several UCTIS funds.
Paul Marshall of Marshall Wace
In order to see what has this combination of strategies brought back, we’ve gathered some of the fund’s performance figures. For instance, its MW Market Neutral TOPS Class A (USD) fund, which utilized equity market neutral investment strategy, brought back 12.38% in 2016, and generated a 3-year compound annual return of 14.87% from 2014 to 2016.
Its Marshall Wace Global Opportunities fund that relies on long/short investment strategy returned 13.37% in 2013, and a 3-year compound annual return (ending December 2013) of 15.47%.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Marshall Wace's flagship Eureka fund returned 0.58% in 12 months to February 28th, 2017, compared to 15% it brought back in the same period one year earlier. And, last year, it brought back 0.6%, whereas its MLIS – Marshall Wace TOP UCITS Fund (Mkt Ntrl) B – USD returned -4.14% in 2018, MW Global Financials M/N A USD generated 0.14%, Marshall Wace Market Neutral TOPS brought back -0.6%, MW Global Opportunities returned 2.9%, and its MW Liquid Alpha Ucits Fund had a better year, delivering 4.27%.” data-reactid=”27″>Marshall Wace’s flagship Eureka fund returned 0.58% in 12 months to February 28th, 2017, compared to 15% it brought back in the same period one year earlier. And, last year, it brought back 0.6%, whereas its MLIS – Marshall Wace TOP UCITS Fund (Mkt Ntrl) B – USD returned -4.14% in 2018, MW Global Financials M/N A USD generated 0.14%, Marshall Wace Market Neutral TOPS brought back -0.6%, MW Global Opportunities returned 2.9%, and its MW Liquid Alpha Ucits Fund had a better year, delivering 4.27%.
Its MW Global Opportunities A USD delivered 13.34% in 2013, 6.31% in 2014, 6.47% in 2015, -0.28% in 2016, and 12.88% in 2017. In 2018, through October it generated a return of 3.97%. Its total return amounted to 195.68% for a compound annual return of 11.98%, while its worst drawdown was 7.60.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Insider Monkey’s mission is to identify promising (and also terrible) hedge fund stock pitches and share them with our subscribers. We launched a long activist investing strategy in our monthly newsletter 2 years ago. This strategy’s stock picks returned 61% in 2 short years, vs. a gain of 21% for the S&P 500 Index ETF (SPY). Last October we shared one of our stock picks, Ascendis Pharmaceuticals (ASND), in a free sample issue of our monthly newsletter (you can still download it free of charge). The stock doubled in less than 5 months.” data-reactid=”29″>Insider Monkey’s mission is to identify promising (and also terrible) hedge fund stock pitches and share them with our subscribers. We launched a long activist investing strategy in our monthly newsletter 2 years ago. This strategy’s stock picks returned 61% in 2 short years, vs. a gain of 21% for the S&P 500 Index ETF (SPY). Last October we shared one of our stock picks, Ascendis Pharmaceuticals (ASND), in a free sample issue of our monthly newsletter (you can still download it free of charge). The stock doubled in less than 5 months.
We have also been very successful at identifying stocks that will decline even in a bull market. We launched our short strategy a little more than 2 years ago and share our short stock picks in our quarterly newsletter. This strategy’s picks lost 30.9% since then, vs. a gain of 24% for the S&P 500 Index. This means our short strategy actually outperformed the market by nearly 55 percentage points (let us know if you don’t understand how the outperformance for a short strategy is calculated).
Recently our monthly newsletter identified another undervalued stock that is expected to increase its earnings by more than 10% annually and trades at only 10 times its 2019 earnings. We expect this stock to return 60% in the next 12-24 months. We take a closer look at hedge funds like Marshall Wace in order to identify their best and worst ideas.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Moving on to Marshall Wace 13F portfolio, which was valued $38.87 billion at the end of March, up by 274.88% from $10.37 billion at the end of the last quarter of 2018. Having a very diversified portfolio, the fund held more than 2,000 positions at the end of the quarter. Some of them, such as Amazon.com, Inc. (NASDAQ:AMZN) and Microsoft Corporation (NASDAQ:MSFT) were among 30 Most Popular Stocks Among Hedge Funds in Q1 of 2019. In Amazon, the fund reported $130.8 million worth a position, on the account of 73,451 shares outstanding, and in Microsoft it held $12.36 million worth a stake, counting 104,823 shares.” data-reactid=”36″>Moving on to Marshall Wace 13F portfolio, which was valued $38.87 billion at the end of March, up by 274.88% from $10.37 billion at the end of the last quarter of 2018. Having a very diversified portfolio, the fund held more than 2,000 positions at the end of the quarter. Some of them, such as Amazon.com, Inc. (NASDAQ:AMZN) and Microsoft Corporation (NASDAQ:MSFT) were among 30 Most Popular Stocks Among Hedge Funds in Q1 of 2019. In Amazon, the fund reported $130.8 million worth a position, on the account of 73,451 shares outstanding, and in Microsoft it held $12.36 million worth a stake, counting 104,823 shares.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Among the biggest positions Marshall Wace decided to sell in the quarter were those in Citrix Systems, Inc. (NASDAQ:CTXS), D.R. Horton, Inc. (NYSE:DHI), and The Brink’s Company (NYSE:BCO). The fund dropped $40.66 million worth a position on the account of 396,825 shares in Citrix Systems, $30.97 worth of stake on the basis of 893,599 shares in D.R. Horton, and its position in Brink’s, which was valued $28.51 million and counted 441,006 shares outstanding.” data-reactid=”37″>Among the biggest positions Marshall Wace decided to sell in the quarter were those in Citrix Systems, Inc. (NASDAQ:CTXS), D.R. Horton, Inc. (NYSE:DHI), and The Brink’s Company (NYSE:BCO). The fund dropped $40.66 million worth a position on the account of 396,825 shares in Citrix Systems, $30.97 worth of stake on the basis of 893,599 shares in D.R. Horton, and its position in Brink’s, which was valued $28.51 million and counted 441,006 shares outstanding.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Click here to read the rest of this article, where we present Marshall Wace’s Q1 2019 top positions.” data-reactid=”38″>Click here to read the rest of this article, where we present Marshall Wace’s Q1 2019 top positions.
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="Disclosure: None” data-reactid=”39″>Disclosure: None
<p class="canvas-atom canvas-text Mb(1.0em) Mb(0)–sm Mt(0.8em)–sm" type="text" content="This article was originally published at Insider Monkey. ” data-reactid=”40″>This article was originally published at Insider Monkey.
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