Jupiter records strongest quarter of inflows as a public company
UK-listed fund manager boosted by demand from Asian and European clients
Jupiter Asset Management recorded its strongest quarter of fund inflows since the London-headquartered investment manager went public seven years ago on the back of an international expansion and buoyant stock markets.
The UK-listed fund house shrugged off the pressures facing active managers as it drew inflows of £1.3bn during the first three months of the year, reversing the company’s fourth-quarter slide when investors pulled money from its funds.
Jupiter’s total assets under management jumped by 7.4 per cent to £43.5bn on the back of new money from investors and strong investment performance.
Maarten Slendebroek, chief executive of Jupiter, which is the fifth largest listed fund house in the UK by assets, said: “The continued strategy to diversify our business by product, client type and geography and delivery of strong investment performance after fees across a broad range of strategies has resulted in good inflows both internationally and within the UK.”
In contrast, British rival Henderson, which is in the process of merging with Janus, the US asset manager, last week posted investor redemptions in the first months of 2017. Janus also posted outflows for the quarter.
Jupiter’s strong inflows, which beat the company’s previous record of £900m of new money during the first quarter of 2015, come at a time when the UK fund industry is under close scrutiny.
In an interim report into the asset management industry last year, the UK’s financial watchdog was sharply critical of business practices in the sector, including how much investors are charged for actively managed funds and a lack of relationship between fund fees and investment performance.
Active managers have suffered large redemptions in recent years as investors shunned higher fee products for cheaper passive funds.
But Jupiter, whose share price rose 2 per cent in morning trading, said the company was well positioned for growth. “Net inflows, underpinned by the delivery of strong investment outperformance after all fees to investors, affirm the confidence we have in our diversification strategy offering potential for further long-term growth.”
During the first three months of 2017, Jupiter’s high-fee generating mutual fund business drew in £1.4bn, in part following by an uptick in demand from Asian and European clients.
Jupiter said demand had been particularly high for its fixed income, absolute return, multi asset and global emerging market products. Institutional investors withdrew £93m from mandates to invest given to the fund manager, however.
Julian Bates, an analyst at Liberum, the investment bank, described the overall inflows as “impressive”.
“Jupiter has achieved more than half of our net inflow forecast for the full year of £2.4bn,” he said.
But Paul McGinnis, an analyst at Shore Cap, the broker, warned Jupiter could still come under pressure this year. “[It] retains a high exposure to a UK retail market [that is] under regulatory pressure to reduce the total cost of investment.”
Jupiter was one of the few UK-listed asset managers to post inflows in 2016. The fund house reported new money of £859m during the year, despite suffering £373m of outflows during the fourth quarter of 2016.