Man Group loses $5bn of new money
London-headquartered hedge fund manager Man Group has lost half of the $10bn (€6.9bn) it has garnered in new funds over the last six months, as market turmoil hit what one consultant called “a bellwether” of the hedge fund industry.
Man Group released the figures in a statement on its performance and estimated assets under management to September 30, this morning.
Peter Clarke, chief executive of the London-listed company, said the "turbulent markets" have hit all asset classes this year and wiped $5bn from the amount in Man Group's funds so far this year.
The loss leaves the group with $70.3bn under management, a 6% drop from six months ago. However, Man Group’s estimated $10bn taken in new funds is 25% more than for the corresponding period last year.
John Godden, founder of hedge fund consultants IGS Group, said Man Group was "always a bellwether and a very good guide to what really are the gross inflows into the industry".
Godden added: "Bringing in $10bn is not bad, probably a bigger number than most people would have expected, and it shows hedge funds have outperformed nearly every asset class on this planet recently apart from gold and oil, and there is still quite a lot of money going into them."
Shares in Man Group fell 11.7% to 332p by 10:51 GMT after the company's pre-close statement. Its shares have declined 39.2% this year.
Man Group's flagship managed futures investment program AHL was up 0.9% this year to September 24.
Tushar Patel, founder of London fund of hedge funds HFIM, said AHL tilted Man Group's exposure towards futures markets, which may have been less effected than other asset classes by illiquidity, and also less effected by regulators' recent actions against hedge funds.
Man Group said that "primarily as a result of a lower contribution from AHL" it expected performance fee income to be 40% less in the six months to September 30 than during the same period last year.
Man Global Strategies, the company's fund structuring unit, has lost 10.8% this year, while RMF, the division of the company that provides funds of hedge funds for institutional investors such as pension funds, lost 2.5%.
Man Group was not added to the list of UK financial firms which speculators cannot take fresh short positions in. However, only 3% of its market capitalisation was on loan on September 19, the day the UK regulator the Financial Services Authority slapped a ban on taking fresh short positions in UK banks, or adding to existing ones, according to DataExplorers.com.
By last Thursday, the last day for which DataExplorers.com had data, only 2.8% of Man Group's shares were on loan.
--write to dwalker@efinancialnews.com
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