Man’s GLG unit performance stabilised assets last quarter
The strategy of Man Group to diversify its fund styles by buying discretionary hedge fund manager GLG Partners in 2010 paid off last quarter, as over 10 of GLG’s funds posted healthy gains exceeding 6%, in contrast to Man’s flagship computer-driven AHL strategy, which rose just 0.8%.
The gains and inflows at the $28.6bn GLG unit last quarter offset asset falls at $19.5bn AHL and Man’s $10.9bn multi-manager unit, and meant Man’s total funds rose slightly, by $600m to $59bn.
Back when Man chief executive Peter Clarke bought GLG, a London boutique co-founded by Noam Gottesman and Pierre Lagrange (pictured), he pointed to the complementary natures of GLG’s human-driven funds, and the model-driven AHL.
The logic has not worked every quarter, but last quarter it did.
The $19.5bn AHL program suffered net outflows of $700m last quarter, and made just 0.8% in its Diversified variant. This still leaves AHL 14% away from its own previous peak, on a weighted average basis, according to the group.
Unsurprisingly in a quarter when global shares jumped 11.2%, it was GLG’s long-only equity funds – Japan and global – that stood out with returns of 21.5% and 13.9% respectively.
Most of the $400m net inflows into Man’s long-only products went to its Japan portfolio, and the long-only suite rewarded investors by generating $1.5bn of performance gains.
GLG’s Ucits convertible fund, market-neutral equities and European distressed fund all registered double-digit returns. A further five GLG funds made over 6%.
Hedge funds overall made 4.9% last quarter.
Three quarters of GLG’s funds under management are above or within 5% of their respective high water marks, typically the point at which hedge funds can recommence collecting a lucrative performance fee.
Despite the good performance from many funds, Man suffered net outflows of $1bn, including $1.4bn redeemed from its hedge funds.