The MAR ratio is a variation of the Sharpe ratio; the MAR ratio evaluates performance with respect to the amount of risk taken when achieving the performance. The annual return is divided by the maximum monthly loss. A correlation of 1:1 shows that the yields were achieved by applying an appropriate risk factor. A correlation of exactly 100:1 indicates that no losses were made in the observation period.

Maximum drawdown describes the greatest reduction in value of a fund or index for a six-month period over the past three years.

Most investments require a minimum investment amount; this amount is stated in the sales prospectus.

The segment of the alternative investment industry which actively trades and manages futures instruments [see Futures]. The advisers that focus their asset management efforts on futures are known as CTA's [see Commodity Trading Adviser]. They invest on both the long and short side of the market and usually employ quantitative or technical analysis [see Quantitative analysis/approach] and systematic investment processes.

The amount of capital that has to be deposited as collateral in order to gain full exposure to an asset.

Denotes an approach to investment where the emphasis is on the value of securities relative to each other and the use of arbitrage techniques [see Arbitrage], rather than market direction forecasting. By emphasising the relative value of securities and the exploitation of pricing anomalies between related securities, practitioners of market neutral approaches aim to generate profits regardless of the overall direction of broad market prices. Market neutrality is generally achieved by offsetting or hedging long and short positions or maintaining balanced exposure in the market. The term market neutral can be applied with some justification to the majority of alternative investment styles because of their ability to capitalise on both upward or downward price moves or to profit in a wide range of market environments.

A mathematical technique used to model the price characteristics of an investment structure based on random simulations of the underlying assets or variables that affect the price of that investment. In the context of the modeling carried out at Man, the analysis involves constructing multiple NAV paths for a product, net of all appropriate fees and interest, using random samples of gross monthly returns. The price characteristics that can be modeled using this powerful technique are known as 'path-dependent' characteristics, such as risk, return, and drawdowns, which depend on NAV movements over the life of an investment structure.

The speed of price change over a period of time. Momentum based investment styles, notably trend following approaches, aim to capitalise on the acceleration in directional price movements, be they upward or downward.