Record sales at Man Group in challenging quarter

7th Jul 2011 07:10

Funds under management (FUM) at hedge fund manager Man Group rose to $71bn at the end of June on the back of record sales for the quarter.FUM climbed from $69.1bn at the end of March as the group racked up sales in the quarter of $9.0bn to record a net inflow of $3.7bn after redemptions of $5.3bn.The group noted that its recently launched open ended onshore AHL fund in Japan now has $2.3bn in FUM, while revenue synergies from the GLG acquisition include $1.0bn from an emerging markets currency product in Japan and $400m from the first guaranteed product blend - Man IP 220 GLG."Following the successful integration of GLG at the end of 2010, we are seeing revenue synergies building, with investor flows into AHL, GLG strategies, and combination products," said Peter Clarke, chief executive of Man.Despite the record sales, FUM still came in a bit below the forecast of $71.5bn by Singer Capital Markets, though the broker was on the money with its prediction of "a net inflow of funds of at least $2.5bn."Man said that challenging market conditions during the quarter put a $1.1bn dent in FUM. The flagship AHL fund was down 0.6% in the period and off 12% from its peak on a weighted average basis.Other movements of $1.8bn were driven by routine rebalancing of investment exposure in the guaranteed products after negative AHL performance in the rebalancing period; foreign exchange movements added $0.8bn; acquisition of the remaining 50% of Ore Hill added $0.3bnThe group said its financial position remains strong, with a regulatory capital surplus of around $900m, net cash of around $900m and total available liquidity resources of around $4.8bn."Current markets are creating challenging performance conditions for most asset classes, and our assumption is that investor sentiment will remain patchy over the summer months. The combination of our broad range of liquid investment styles, ability to craft portfolio solutions for investors, and the wide geography of our franchise, is a key advantage in these markets," Clarke claimed. --jh