Man Group profits double amid hedge fund recovery
MAN Group has joined the list of hedge funds and asset managers benefiting from a return in investor interest, attracting a record $8.2bn (£6.2bn) of new money during the first half.
The FTSE 250 hedge fund saw profits almost double on last year to $145m after it drew billions of pounds from investors in the six months to June 30, up from inflows of $1bn a year ago.
Its inflows for the first half, which marked its highest ever, bumped its total assets under management for the period up 25pc on last year to $95.9bn.
The firm, which was founded in 1783 as a sugar brokerage and invests in markets around the world, is the latest beneficiary of a recovering market following the sector’s biggest loss of investor cash since the crisis. Investors pulled more than $100bn from hedge funds last year in what marked the biggest withdrawal of money from the sector since 2009, according to data from analytics firm evestment.
“Investor flows for 2016 resembled an industry in crisis,” the group said. “They were similar to mid-2011 and 2012 in persistence, but dwarfed outflows seen during the European sovereign crisis in magnitude.” Things have since picked up, with analyst Eurekahedge noting that net inflows for the first half came in at $55bn, compared to losses of $70bn a year ago.
Luke Ellis, Man Group’s chief executive, suggested the gold rush was unlikely to continue in the months ahead.
“The first half was unusual in both the scale of net inflows, and the level of margin compression,” he said. “We would expect both to moderate in the second half.” Shares in the business, which acquired property manager Aalto during the period, jumped 5.4pc to 168.6p following the announcement.