Listen to this article
Man Group reported the highest-ever level of money it manages at $80.9bn, driven by new investments in its quant strategies, an acquisition, and positive performance in some of its funds.
Its quant alternative strategies, which use computer algorithms to make investing decisions, attracted a 20 per cent increase in assets from new investments, despite mixed performance over the past few years.
The increase in overall funds came despite a drop in revenue from management and performance fees.
The company, the largest publicly-traded hedge fund, reported a pre-tax loss for 2016 of $272m, largely driven by losses at GLG, its discretionary hedge fund unit. That’s down from a profit of $184m in 2015.
Funds under management rose 3 per cent to $80.9bn, up from $78.7 at the end of 2015. They took a significant hit from foreign exchange translation and other moves, which cost them $2.9bn, just slightly less than in 2015.
Luke Ellis, chief executive of Man Group, said:
2016 was a challenging year for the investment management industry and despite respectable relative performance from our strategies, this is reflected in our results.
Against this backdrop, we have made real progress in positioning the firm for the future. We delivered positive net flows, in a year when our industry saw outflows.
We had positive alpha across our long only strategies, during a year in which many questioned the benefits of active management. We put in place a revised management structure and continued to control our cost base, and the majority of our performance fee eligible funds ended the year at, or close to, high water mark.