The value and income from the fund's assets will go down as well as up. This will cause the value of your investment to fall as well as rise and you may get back less than you originally invested. There is no guarantee that the fund will achieve its objective and you may get back less than you originally invested. Past performance is not a guide to future performance.
Combining human expertise and machine intelligence
In December 2024, we reached the 5-year anniversary of the launch of the pioneering M&G (Lux) Global Maxima Fund. This milestone provides an opportunity to reflect on the fund’s remarkable journey in combining human expertise and machine intelligence to achieve its investment objective and outperform the global equity market over five years.
The fund leverages advances in artificial intelligence (AI), data science and computer processes to provide stock-picking recommendations. The fund’s AI-driven approach builds on the foundation of an earlier M&G AI-based machine learning strategy, which was conceived in 2017. After building the team, launching the first prototype and testing it for a year, we officially launched the fund in December 2019.
Five years on, we’re now running the fourth version of the model. The team has grown from two to five investment professionals, with significant technical and infrastructure support and our assets under management have surpassed one billion US dollars1.
Beyond the hype: AI is here to stay
We understand that, as AI continues to transform the investment landscape, investors are eager to understand how this technology is impacting the decision-making process and reshaping the role of human investment professionals. With AI becoming increasingly ubiquitous and large language models like ChatGPT hitting the mainstream in a dramatic way, there’s no shortage of buzz surrounding the theme of AI.
However, we view AI as more of an evolutionary development. As such, we feel that, with a diligent approach to implementing AI techniques, we’re able to produce differentiated outcomes. That said, it is important to remain cautious in the application of AI, as not every problem is well suited to the use of AI in its solution.
AI is undoubtedly here to stay, in our opinion, driven by three key factors: the evolution of modelling techniques, the growth in computational power and the explosion of available data. With an estimated 90% of the world’s data being created in the last two years, we believe AI’s role in asset management will continue to grow more central to investment decision-making.
AI and the M&G (Lux) Global Maxima Fund
AI-based decision-making is at the heart of our investment process. Our approach mirrors the traditional investment process — collecting data, modelling it, making predictions and constructing a portfolio — but it does so at scale, without the biases often associated with human decision-making. It enables us to access useful information from text, images and sound, enhancing our investment decision-making. As AI techniques develop, we continually explore new methods to refine our models.
We use historically representative data from the investment landscape to train our AI model, enabling it to learn underlying patterns and provide us with a rich view of the market. These models not only help us predict investment outcomes but also deepen our understanding of how market factors interact.
We believe the value of these AI-derived insights and the effectiveness of our investment process are demonstrated by the investment outcomes we have achieved. Over the past 5 years, the fund has repeatedly outperformed its benchmark, the MSCI All Country World Net Return Index, in both falling and rising markets.
On a cumulative basis, since its launch in December 2019 to the end of 2024, the fund has delivered a total return of 72.4% in US dollars, more than 5 percentage points ahead of its benchmark, which has returned 66.6% over the same period. We believe this achievement is notable, especially considering the challenging environment for global equity managers; the fund’s peers underperformed, on average, by an annualised 400 basis points during the same period. At the end of December 2024, the M&G (Lux) Global Maxima Fund ranked in the top quartile for performance over one and three years and in the top decile over five years2.
M&G (Lux) Global Maxima Fund performance – Outperforming the global equity market over 5 years
Past performance is not a guide to future performance
Cumulative returns since inception*