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Man funds up as client base sees recovery

MAN Group, the largest listed hedge fund manager in the world, said yesterday that assets under management had increased during the group&rsquo;s fiscal second quarter, the first quarterly rise in a year.<br /><br />The group saw funds under management reach around $43.8bn (&pound;27.4bn), a 1.2 per cent rise on the $43.3bn seen at the end of June.<br /><br />The trading update sent the firm&rsquo;s shares up 7.5 per cent to 331.2p, despite warnings that first-half profit was likely to fall 55 per cent to $280m from $622m in the same period last year, due to falling fee income.<br /><br />Chief executive Peter Clarke said he was upbeat about the company&rsquo;s prospects as the global economic crisis begins to abate.<br /><br />&ldquo;Investor sentiment is continuing to improve across the industry, the performance outlook is healthy and the prospects for sustained industry inflows are very promising,&rdquo; he said.<br /><br />If Man can indeed deliver net inflows, it would be a marked turnaround from the six months to 31 September 2008, during which it saw a $4.6bn net outflow of institutional assets, as investors were spooked by the group&rsquo;s exposure to convicted fraudster Bernard Madoff.<br /><br />The group, which lost $360m on the scandal, said earlier this year that it had lost clients as a result of the affair.<br /><br />But it said yesterday that while institutional sales were &ldquo;muted&rdquo; in the second quarter, it had seen redemptions decline from $3.6bn in the first quarter to $1.7bn in the second three months of the year.