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Reality bites for fantasy fund manager Manek

Fantasy fund manager competition winner Jayesh Manek is to close his perennially underperforming fund after 20 years.

Reality bites for fantasy fund manager Manek

The man who captured the imagination some 25 years ago after winning a fantasy stockpicking competition is shutting his fund under less glorious circumstances. 

Former pharmacist Jayesh Manek launched his Manek Growth fund in 1997 to huge fanfare after back-to-back wins in the Sunday Times fantasy fund manager competition in the early 1990s. 

His apparent stockpicking skills caught the eye of legendary investor John Templeton, who gave Manek £10 million of his personal fortune to invest on his behalf. 

This investment helped Manek set up his investment firm Manek Investments, through which he launched the Growth fund. 

Manek's fantasy stockpicking success was initially replicated on the fund as it returned 160% in its first three years with assets shooting up to £300 million.

However, things turned sour for him after the technology bubble burst at the turn of the century and he has never recovered. 

Over the last three years to the end of October the fund is rooted at the bottom of its sector, losing 21.4% versus an average manager return of 32%. 

The fund also languishes at the bottom over 10 years with a massive loss of 55% versus an average 69.9% return among its peers. 

Assets in the fund have shrunk to £8 million, which has finally prompted Manek to shut it down. The wind up date has been set for 28 December. 

'We have monitored the overall investment in the fund and have concluded it is below the minimum sustainable value,' Manek wrote to remaining unitholders in a letter posted on his firm's website. 

'We believe, that continuing to operate the fund at this level would not be economically viable as the fund size is too small to be managed efficiently.'

3 comments so far. Why not have your say?

Hank Elvis Dobbs (texan)

Nov 17, 2017 at 10:13

mmmm...all you Woodford knockers

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William Phillips

Nov 17, 2017 at 15:50

Unfortunately he sold his chemist shops back in 1999, so he has not got them to fall back on. Still, a decade ago he and his management company were pulling in c. £250,000 pa in fees and dividends. I doubt he'll starve.

He had submitted multiple entries to the competition, but we only heard about the performance of the winners.

In late 2000, as the dotcom crash was under way, Manek 'caught a falling knife' by repurchasing Marconi for recovery. Instead it became one of the few giant companies to end up worthless. This may have been the turning point for his reputation, showing that he was not a natural trader.

The long but shallow bull market of 2002-07 lacked sensational growth stocks or a new concept- unlike the internet mania in the Nineties. Conditions did not suit his stockpicking inclinations and caused bored investors to peel off. They were quitting in droves in the mid-2000s even as the Growth Fund perked up.

You cannot say it was fun while it lasted. Mostly it has been a long disillusionment.

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richard tomkin

Nov 18, 2017 at 11:40

Small fortunes are big ones gone wrong.

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