Managed assets rise above US$60b at Man Group
MAN Group Plc, the world’s largest publicly traded hedge fund manager, said assets under management rose above US$60 billion as clients added more money in the final quarter of 2006 compared to a year earlier and investments gained.
Fund sales reached US$2.5 billion in the quarter, while redemptions stood at US$1.1 billion, London-based Man said in a Regulatory News Service statement yesterday, according to Bloomberg News. Fund performance added US$2 billion to assets. Man had US$56.8 billion under management at the end of September.
Chief Executive Officer Stanley Fink, who steps down in April, has increased Man Group’s assets under management more than tenfold during his five-year tenure. Net client inflows totaled US$1.4 billion in the three months through December, double the US$700 million during the same period a year earlier.
“The good news in the story is the low redemption rate and the sales to private investors,” said Bruce Hamilton, an analyst at Morgan Stanley in London who has an “overweight” rating on the stock.
Man Group said US$34.6 billion of its assets were overseen for individual investors, compared with US$23.5 billion for institutions. Companies benefit from individual investors because they tend to pay higher fees than institutions such as pension funds.
Replacement
During the first six months of the company’s fiscal year, which end in March, Man Group posted net inflows of US$7 billion.
Fink took over Man in 2000 when it had US$4.7 billion of assets. He will be replaced by Finance Director Peter Clarke.
The company took in money even as some of Man Group’s funds underperformed. Its flagship AHL Diversified fund last year gained about 6.4 percent to December 25, undershooting the 17 percent surge of the Morgan Stanley Capital International World Index and the 11 percent gain for the Standard & Poor’s 500 Index.
Hedge funds typically cater to clients with at least US$1 million to invest, and take larger bets than traditional funds. They usually charge a fee of about two percent for managing money as well as 20 percent of any investment gains.