NEW YORK (HedgeWorld.com)--Man Group plc stock fell about 2% on the London Stock Exchange after the company reported on the growth of assets during the fourth quarter of 2005. The price slip apparently reflected trader disappointment with the numbers.
Man sales in the three months ended Dec. 31 totaled US $2.1 billion, including US$900 million from the latest structured note, Man IP 220 Ltd. But at the same time investors pulled out US$1.4 billion, so that net inflow was US$700 million.
Adding investment returns of US$600 million and adjusting for currency and other differences, Man's total assets are at US$45.8 billion, up from $44.4 billion in September.
On a past occasion, Man chief executive Stanley Fink has said that the firm's assets represent about 4% of the hedge fund market at large. With industry assets variously estimated at between US$1.1 trillion and US$1.4 trillion globally, Man remains around that percentage.
Both the industry and the company have grown extraordinarily fast in the past five years, and now that both are a lot larger, the rate of expansion is bound to slow down. Fear of asset growth tapering off, as well as poor investment returns, curbed Man's share price in early 2005.
But in November and December the stock took off, outperforming the FTSE 100 Index, of which it is a component, as well as the specialty and other financials segments of the index, the industry to which it belongs.
Even with the falloff from the asset report today [Jan. 12], the stock is trading in a significantly higher range than it did a couple of months ago. It was at GBP20.12 (US$35.41) as of press time, after having reached a low of 11.50 pounds in the past 52 weeks.
Man, which has a brokerage arm in addition to asset management, acquired the futures business of scandal-ridden Refco Inc. in November--a boost to the share price.
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