Man Group boosted by net inflows after volatile quarter

By Simon Jessop

LONDON (Reuters) - British hedge fund manager Man Group (EMG.L) recorded net inflows for the first time this year during the third quarter even as the value of its assets fell.

Fund managers have been hard hit in the quarter as concerns about global economic growth and a stock market rout in China undermined trading strategies that rely on rising markets. This took its toll on Man's assets, which fell 2.5 percent to $76.8 billion (£49.6 million) at the end of September from three months earlier.

Among its worst-performing funds were 'long-only' ones unable to bet on falling markets, which collectively lost $3.1 billion. The assets of funds that could bet on markets moving either way, however, rose $300 million.

But the firm was buoyed by a return to net inflows of some $1.4 billion, particularly into its algorithm-based trading funds.

"Despite the extreme market movements in late August impacting absolute performance across our long-only strategies, we have seen good relative performance across the majority of our strategies for the year to date," said Chief Executive Manny Roman.

He said the firm had a "solid pipeline of sales in the near-term", but added they would likely be "lumpy" given the volatile macroeconomic backdrop.

Shares in Man were up 3.9 percent at 157.1 pence a share at 0742 GMT (8.42 a.m. British Time), among the top gainers on the FTSE mid-cap index (.FTMC).

Analysts at JPMorgan said the asset fall had been in line with consensus expectations, but that the net inflows had been above expectations of $800 million.

Describing the results as "credible" during a difficult quarter, Credit Suisse analysts flagged an 'Outperform' rating and 190 pence price target in a note to clients. "The drive towards a more balanced business continues and good relative fund performance across multiple strategies should support that," they said.

(Editing by Sinead Cruise and Pravin Char)