Polar Capital saw its total AUM drop to £18.8bn from £22.1bn between April and September, as the asset manager felt the sharp bite of this year’s market headwinds. However, of the £3.3bn in lost AUM, only £100m occurred in its fiscal second quarter ending 30 September.
The challenging market conditions were responsible for £2bn of the firm’s lost AUM, whereas net outflows totalled £845m. Open-ended funds recorded £753m worth of redembtions, while investors pulled £62m from investment trusts and £30m from segregated mandates.
Fund closures also played a part, with £459m lost after two Phaeacian mutual funds, along with the related segregated mandate, shut earlier this year.
As investors reduced their equity exposure this year, Polar’s UK Values Opportunities Fund witnessed £250m walk out the door. The strategy is down nearly 25% since 30 September 2021, compared to FTSE All-Share which returned -4.4% over the same period, according to the latest figures from Polar Capital.
The firm was hit hard by tech sell-off, and though this trend continues, the rate at which investors pulled their money from Polar’s open-ended technology funds slowed considerably; the £252m that was withdrawn in its second quarter was 35% lower than the figure for the first quarter for this year.
In other positive news for the firm, Polar Capital has accrued £4.8m of performance fees in the six months to 30 September, more than double the total from this point last year, and already surpassing the £4.1m accumulated in the year to March 31 2022.
Despite the tough trading conditions, Polar Capital CEO Gavin Rochussen (pictured) remained positive, highlighting inflows into the firm’s Global Insurance, Biotechnology, Healthcare Blue Chip, Smart Energy, European ex-UK Income, Emerging Market Stars, Forager and Global Absolute Return funds, which collectively attracted £260m in the firm’s fiscal second quarter.
He added: “Despite the challenging back drop, we are pleased with the continuing progress in diversifying the business. The Smart funds managed by the Sustainable Thematic team have now collectively reached £150m. The Emerging Market Stars team have had success in the US with the Emerging Market Stars Mutual Fund raising its first £50m.
“The well-established Polar Capital Global Insurance fund has continued to deliver robust performance with net inflows of £257m in the six months. The team’s low appetite for catastrophe risk has protected investor returns with the fund well positioned to benefit from ongoing premium rate rises in commercial insurance and a recent acceleration in reinsurance pricing. For the calendar year to September 2022, the fund has achieved absolute positive performance of 12.2% which is 6.5% ahead of its benchmark.
“We remain confident that with our diverse range of differentiated, active specialist fund strategies we are well-positioned to perform for our clients and shareholders over the long term.”
