Polar Capital’s assets have fallen by nearly half over the past 14 months, but investors are returning to the London-based hedge fund, its CEO said.

Mark Kary told Reuters that Polar has enjoyed “small net inflows” since the end of March, with its global macro and European long/short equity funds the greatest beneficiaries of new investor interest. And he said the firm, which has seen its assets under management dwindle from US$3.1 billion at the end of the first quarter of last year to just US$1.54 billion at the end of May, might acquire other firms in an effort to rebuild its assets.

Polar’s pretax profit dropped 17% to £12.1 million (US$20 million) during the year-ended March 31, mostly due to the drop in assets, which “implies a material reduction in our core revenues,” Kary said. During the fiscal year, Polar shuttered funds managing US$992 million, while investors redeemed a further net US$170 million.

Kary said that this year’s results would depend in large measure on Polar’s ability to generate performance fees and bring in new money. To that end, the firm is looking to bring on new manager talent, either through individual hires or through acquisition.

“There are some high-quality organizations that because of last year and… what went on in the markets are in some distress and which you could buy on more attractive terms than a year ago,” he said.