The FTSE 250 fund group’s total net outflows were some £300m higher than analysts had anticipated as it suffered its worst period of quarterly flows in nearly two decades. Only three of the asset manager’s last 76 quarters have been negative, the largest being -£355m in the final quarter of 2016.
In a reversal of fortunes, Jupiter’s fixed income strategy, which was responsible for the majority of 2017’s inflows, was the primary driver of outflows over the quarter, as clients withdrew £1.1bn worth of assets from its bond funds.
Though the asset manager did not name and shame the funds that resulted in its difficult quarter, analysts tracking flows into its products said the Dynamic Bond fund, run by Ariel Bezalel, accounted for the vast majority of redemptions.
Inflows into its European Growth and Multi-Asset strategies helped offset some of these losses, Jupiter said in the trading update, but its mutual funds still ended the period with net outflows of £929m.
Overall, Jupiter said that flows from UK investors remained “broadly flat” in the more volatile first quarter but were negative across all other geographic regions, with Continental Europe and Asia the most impacted.
Its segregated mandates and investment trusts units also ended the period with net outflows, down £306m and £15m respectively.
Total assets under management fell 6.6% to from £50.2bn to £46.9bn.
Maarten Slendebroek (pictured), Jupiter chief executive, admitted it was “a challenging start to 2018” for Jupiter with market turbulence and subdued demand resulting in higher redemptions.
However, he said that as the firm noted in its full year results presentation in February, “this change in the flows trend is not unexpected”.
“The growth of assets sourced from international distribution partners has changed Jupiter’s flow profile to being less predictable in the short term,” he said. “As a result, in future we expect to see continued growth but with higher quarterly differentiation.”
Despite this, its share price still slipped during Wednesday morning trading, and was down 5.3% at 443p at the time of writing.
This week the fund house announced plans to expand its alternatives business, with an appointment and planned fund launch set for later this year.
