29 Sep 2011
The share price of Man Group fell over 20% after it reported net outflows of investor funds of $2.6 billion during the quarter to end-September. In a trading update, Man said that funds under management fell to $65 billion at Sep 30 from $71 billion three months earlier.
Man also estimated that first half pre-tax profit would be $145 million. Reports indicated that some brokers were preparing to down grade their earnings estimates.
Man’s fall in assets was the result of redemptions and poor stock performance, notably in several equity long/short funds run by the GLG unit it acquired in 2010. Among the GLG funds that performed poorly were Alpha Select, European Opportunity and Emerging Markets with the latter hit by pronounced volatility.
AHL, the group’s managed futures flagship, saw assets rise to $24.9 billion – an all-time high. The CTA fund has posted gains in 2011, but remains below its high water mark for the majority of investors – thus impacting performance fee income and group level earnings.
The scale of the redemptions shows the extent to which some investors are turning cautious amid high market volatility and euro zone debt problems. Data from across the hedge fund industry shows that investors continued to allocate to hedge funds in the first half of 2011, finding favour in their risk and portfolio management tools in the current volatile financial environment.
Man also estimated that first half pre-tax profit would be $145 million. Reports indicated that some brokers were preparing to down grade their earnings estimates.
Man’s fall in assets was the result of redemptions and poor stock performance, notably in several equity long/short funds run by the GLG unit it acquired in 2010. Among the GLG funds that performed poorly were Alpha Select, European Opportunity and Emerging Markets with the latter hit by pronounced volatility.
AHL, the group’s managed futures flagship, saw assets rise to $24.9 billion – an all-time high. The CTA fund has posted gains in 2011, but remains below its high water mark for the majority of investors – thus impacting performance fee income and group level earnings.
The scale of the redemptions shows the extent to which some investors are turning cautious amid high market volatility and euro zone debt problems. Data from across the hedge fund industry shows that investors continued to allocate to hedge funds in the first half of 2011, finding favour in their risk and portfolio management tools in the current volatile financial environment.
