The tumultuous financial markets of the past three months have knocked $100m from assets under management at the hedge fund Man Group, yet its computer-driven investing strategies protected the group from the worst of the turmoil.
Shares in Man rose 5pc after it reported a dip in assets to $78.6bn in the first three months of the year, with the pain from its loss-making investments more than wiping out the $500m of new money that clients added to the firm.
Man’s computer-based AHL strategies did better than expected, with $1.3bn of inflows and $800m of market gains. With customers piling into AHL as investments elsewhere performed poorly, analysts at Goldman Sachs said sales of these products were “far in excess” of estimates and the strongest since the hedge fund started breaking out the figures three years ago.
The London-based firm’s GLG portfolios fared less well, with its long-only strategies following the stock market lower to reduce its overall funds by $1.5bn in the quarter.
The FTSE 100 suffered its worst start to the year this side of the millennium, with uncertainty about interest rate rises in the US and UK along with jitters about emerging market growth sending traders on a rollercoaster in January and February.
“The first quarter never seemed set to be Man’s finest, but the group has performed reassuringly. In particular, we think that the company’s efforts to diversify AHL have borne fruit,” said Bank of America Merrill Lynch analyst Philip Middleton.
Man’s update came a day after Blackrock, the world’s biggest asset manager, posted a 20pc fall in profits after the falling markets helped to knock nearly two-thirds off its performance fees.
“The ongoing uncertainty in the markets remains challenging and, accordingly, the risk appetite of our clients has the potential to impact flows,” said Manny Roman, chief executive of Man.
Mr Roman is still scouting out potential acquisitions to further diversify the firm, he said. Man’s newly-purchased fund-of-fund outfit FRM and its US unit Numeric both ended the quarter broadly flat.