Man Sees AUM Up, But Suffers Net Outflows In Q1

May 1 2012 | 9:09am ET

Man, the world’s largest hedge fund group, saw its assets climb slightly in Q1 2012 but still experienced net outflows.

The group’s AUM rose to $59.0 billion as of the end of March (from $58.4 billion in December 2011) on investment performance worth $2.0 billion, thanks largely to the returns of its GLG strategies.

Man's Q1 sales totaled $3.1 billion but redemptions of $4.1 billion made for net outflows of $1.0 billion.

The group's Japan Core Alpha strategy returned 21.4% and its Global Equities strategy was up 13.9% in the first quarter while a number of strategies returned 5% or more, including European Long/Short, North American Opportunities, Alpha Select, Global Opportunity, Global Convertibles, Market Neutral, European Distressed, Emerging Markets and Multi-Strategy Alternative.

Man’s flagship AHL computer-driven fund, which helped the firm achieve returns of 33% in 2008, was up 0.8% in Q1 and remains 14% below its peak value on a weighted average basis. The firm has blamed AHL’s poor performance (it turned negative toward the end of the first quarter) on economic intervention by governments which, it argues, has disrupted the market momentum on which its program depends. AHL suffered net outflows of $700 million during the quarter.

Said Peter Clarke, Man chief executive, in a statement: “After a strong start to the year, markets came back under pressure in March and drove greater dispersion in investment performance across our industry. GLG negotiated these conditions well and continued to make money for investors, but performance at AHL turned negative as markets reversed.

“Against this backdrop, redemptions reduced but investor sentiment remained fragile and we are yet to see an increase in sales.”

Clarke said the firm is “on track” to deliver the $75 million in cost savings announced in January.

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