lternative investment management company Man Group Plc (EMG.L), Friday, in an interim management statement for the third quarter, said its funds under management or FUM as at December 31 declined 4% sequentially. The company noted that the reduction can be primarily attributed to AHL negative investment movement due to difficult trading conditions for managed futures strategies particularly in December. However, the company remains confident of growth in assets. According to the UK-based company, funds under management at the end of the period declined to US$42.4 billion from US$44 billion reported in the immediately preceding second quarter, resulted mainly from AHL negative investment movement of US$1.2 billion. Peter Clarke, chief executive said, "The financial third quarter is seasonally a quiet period for sales. The negative performance of AHL in December and a net institutional outflow for the quarter resulted in a 4% reduction in our funds under management as at 31 December."
The company noted that private investor sales were US$1.1 billion for the third quarter and redemption remained low to give a small net outflow of US$0.1 billion. Private investor FUM at the end of the quarter decreased to US$28.7 billion from $29.3 billion at September 30, 2009. Institutional net outflow for the quarter was US$1 billion. Redemption was US$1.4 billion that reflected a higher level of monthly redemption during the quarter. On January 1, 2010, the company paid institutional quarterly redemptions of US$1.1 billion. Institutional investor FUM at the end of the period was US$13.7 billion. In addition, Man Group said its new managed account business is seeing continued high levels of interest from institutional investors. The company also said it has been selected by a large pension fund as the preferred provider for a mandate that could potentially reach around US$1 billion. The deal, subject to contract, will be for a minimum of three years and the allocations will commence in the first quarter of 2010. Man Group noted that its financial position remains strong and regulatory capital surplus remained in excess of US$1.5 billion and available liquidity resources were around US$3.8 billion at the end of the period. "Momentum continues to build across the business and activity levels with investors and distributors remain high...With a promising outlook for hedge fund flows and significant recent progress in our managed account business, Man remains very well placed to grow assets," added Clarke. EMG.L is currently trading at 297.3 pence, down 17.1 pence or 5.44%, on a volume of 15.91 million shares.
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