Man Group’s shares rise after positive returns and investor inflows fuel Q3 FUM surge

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Man Group’s shares rose on Friday morning after the London-listed global hedge fund group’s latest quarterly results showed funds under management swelled 4 per cent in Q3 to USD113.1 billion - driven by what CEO Luke Ellis described as “strong growth” in performance and “robust net inflows” in its alternatives and long-only strategies.

The long-running manager, which manages a wide assortment of discretionary and systematic investment funds in both hedge fund and long-only formats, is often considered a barometer for the UK’s broader alternative asset management industry.

Its alternative funds – encompassing absolute return, total return and multi-manager products managed by its AHL, GLG and FRM brands – grew by USD3 billion in Q3 to USD72.4 billion over the three-month period.

This growth was fuelled by investor inflows of USD1.9 billion, predominantly in its AHL TargetRisk and Alternative Risk Premia products, along with positive investment performance of some USD300 million across various strategies, and USD800 million from FX and other movements.

Performance-wise, AHL TargetRisk was up 2.5 per cent over the three-month period, while AHL Evolution added 1.9 per cent. The GLG European Long Short Fund advanced an estimated 3.9 per cent, while the GLG Global Credit Multi-Strategy Fund made around 3.3 per cent. On the downside, Alternative Risk Premia lost 3.2 per cent.

Meanwhile, Man’s long-only strategies – which comprise both systematic and discretionary funds run by its GLG and Numeric units – also grew some USD1.8 billion to USD40.7 billion, despite net outflows of USD200 million in the third quarter, as equity markets and growth sectors continued their recovery.

The overall Q3 FUM rise of USD113.1 billion – up from USD108.3 billion the previous quarter – helped lift Man’s shares to around 125.00 early on Friday morning following the statement.

Commenting on the results, Man Group’s chief executive officer Luke Ellis welcomed the good Q3 performance and “strong growth” in FUM.

“This was driven by robust net inflows into alternatives as anticipated, as well as performance gains across both alternative and long-only strategies,” Ellis said.

While he sounded a note of caution on “increasing uncertainty” over upcoming political events and current Covid-19 trend, he stressed that Man is “well-placed to withstand volatile periods and to grow over time”, pointing to a “diversified range of strategies, our people and technology and a sustainable business model, underpinned by our strong and liquid balance sheet.”