InvestmentsDec 11 2015

Challenging markets see Polar Capital assets fall 19%

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Challenging markets see Polar Capital assets fall 19%

Polar Capital has recorded a 19 per cent drop in its total assets under management to $10.9bn (£7.2bn) as of September 30 2015 compared with $13.4bn a year earlier.

The firm’s interim results showed its two Japan strategies recorded the largest drop in assets falling from $5.3bn in September 2014 to just $3bn 12 months later. The Global Emerging Markets funds also dropped from $972m of total assets in September 2014 to $504m a year later.

In addition core operating profit, excluding performance fees also slipped in the 12 months to £12.4m from £13.9m, although pre-tax profit increased slightly to £11.7m.

Polar Capital’s healthcare strategies, however, provided some positive news with assets increasing in the 12 month period to $1.4bn, while the Global Convertibles portfolios were the only strategy to consistently increase assets across the six and 12 month periods to reach $436m from $202m in September 2014.

Tim Woolley, chief executive of Polar Capital, noted: “This proved another challenging half year for us. During the last six months we saw a significant fall in global equity markets in late summer and further redemptions from our Japan fund, although recent performance has improved markedly. These two headwinds more than offset some good inflows seen on Global Convertibles, Financials and Healthcare.”

He added the “bulk of the redemptions from the Japan fund occurred in the first quarter and there are encouraging signs that the worst may now be behind us”.

Meanwhile he pointed out: “The two new legs that we added last year, UK Absolute and European Income have delivered good performance in their first year and we are optimistic that both strategies will start to raise assets in the coming 12 months. The European Income team had a further boost during this half-year with a number of clients seeding the launch of a second fund for the team, a European ex-UK Income Ucits fund which we launched in June.”