Man Group Assets Under Management Stagnate in Q1

Man Group shares slide as Q1 AUM flatlines, client pulls $6.1 billion

Man Group Q1 Performance and Client Withdrawals

By Nell Mackenzie

Share Price Reaction

LONDON, April 23 (Reuters) - Man Group shares fell on Thursday after the company reported a client pulled $6.1 billion from one strategy in the first quarter during which total assets under management stagnated.

Man Group shares fell as much as 7% in early trading in London, before recovering somewhat to show a near-5% loss on the day. The company's stock is still up 9% for the year so far.

Assets Under Management and Analyst Expectations

The company said assets under management remained largely flat at $228.7 billion, missing analyst expectations, in a quarter dominated by volatility stemming from the Iran war.

Net Redemptions and Performance

Investors redeemed a net $1.6 billion from the overall hedge fund in the first quarter. Positive performance in several funds and other client inflows helped stem outflows.

The London-listed hedge fund declined to comment on the outflows, which were the highest since 2024, when the company saw a similar chunky redemption also from a single client.

Long-Only Fund Performance

Man Group's long-only fund performance was mixed in the first quarter, but took some losses, particularly in its Man Continental European Growth fund, which at March 31 had returned a negative 10%.

Analyst Consensus and AUM Forecasts

The consensus among analysts, according to a note from Morgan Stanley, was for the hedge fund's total assets to rise to $233 billion, from the $227.6 billion it had as of December 31.

Significant Client Redemption

Man Group said in a footnote in its sparse first-quarter update that one client had redeemed $6.1 billion from its long-only systematic equity strategy. The company declined to comment.

Impact on Long-Only Flows

"Excluding this (one-off client withdrawal), long-only flows would have been positive, reflecting an allocation decision rather than performance," analysts at Jefferies said. "While systematic long-only flows were weak this quarter, they have historically been lumpy (in both directions)."

Credit Strategies and Inflows

Man Group's long-only credit strategies, which posted a flat performance, had net inflows of $2.2 billion, against a backdrop of concern among global investors about the health of private credit this year.

Industry Context and Hedge Fund Performance

Global Hedge Fund Volatility

Hedge funds globally have been whipsawed by volatile trading since the closure of the Strait of Hormuz in early March that has choked off a fifth of the world's daily energy supplies, clouding the global economic outlook and prompting recession fears.

Strategy Performance Comparison

Systematic Hedge Funds

This has meant mixed performance for different hedge fund strategies so far this year. Systematic hedge funds, whose algorithms ride market trends until they peter out, were up on average over 7% so far this year in to end-March, according to Societe Generale.

Industry-Wide Performance

Hedge funds tracked by research firm PivotalPath, which covers the wider industry, returned roughly 1% in the same period.

(Reporting by Nell Mackenzie; Editing by Amanda Cooper)