Man Group: Hedge fund racks up billions in performance losses
Assets at hedge fund Man Group dropped by $5.6bn (£4.2bn) in the first two weeks of April as market volatility hit the asset manager’s strategies.
While assets under management at Man Group jumped from $168.6bn (£127.6bn) to $172.6bn (£130.6bn) in the first three months of the year, they then fell sharply to $167bn (£126.4bn) in the following two weeks, the firm revealed in a quarterly trading statement.
Asset managers across the UK have been reporting brutal losses in the market during the first quarter of 2025 over the last week, reaching as high as £2.3bn for Polar Capital.
However, analysts had expected that those with a focus on alternative assets that are meant to avoid correlation with market crashes would not see similar performance issues, so the drop from Man Group took many by surprise.
Deutsche Bank analyst David McCann had forecast the firm would only book $1.4bn in new flows for the period, while performance and foreign exchange movements would add $2.7bn.
Instead, investor cash flooded into the firm, adding $3.6bn thanks to the popularity of its credit and convertibles business.
Meanwhile, the market dip in the first quarter of the year caused performance to plunge at Man the world’s largest public hedge fund, resulting in $1.1bn in investment losses over the quarter.
The firm’s AHL Diversified fund, which uses trend-following algorithms to try and avoid correlating with the wider market, fell eight per cent in the first three months of 2025, and is down more than 18 per cent over the last year.
The performance issues were largely limited to four of Man Group’s strategies: AHL Alpha, AHL Dimension, AHL Evolution, and AHL Diversified, all of which have seen significant falls over the last three months and the last year.
Despite the falls in performance for Man Group, the run-rate net of its management fees came to a whopping $1bn in the year to 14 April, the group added.