Ann: Funds Under Management - October 2020, page-16

PAC has one fund manager that is performing GQG. The rest are quite frankly terrible. Their FUM growth is distorted by the flows of this one manager and their above market returns generated.

PAC therefore has a number of uncertainties around their futures earnings.

1. Will they always retain GQG, and will they always perform above market
2. What fees can they generate on that stable of managers, how much time and money do they need to put into those that fail or don't attract flows
3. Will any of those managers continue to beat the market, what will that do to PAC's reputation?
4. ROE, as others have pointed out.

MFG control their own investments, their own marketing, their own investment managers. This removes a great deal of uncertainty and aligns all interests of all parties under the MFG flagship.

They charge what they want to charge, invest where they want to invest, and most importantly aren't relying on PERFORMANCE TO INCREASE FUM. THEY ARE GENERATING FLOWS ON A CONSISTENT MONTH TO MONTH BASIS WHICH IS THE MOST IMPORTANT THING. SOMETHING YOU LEAVE OUT OF YOUR ANALYSIS.

Sure, you can argue performance leads flows, but Magellan have proven they can perform over the long to medium term, are great marketers and investors know exactly what they are going to get.