Standard Life’s flagship Global Absolute Return Strategy (Gars) fund suffered outflows of £593m in August, less than the previous month, despite the anemic performance continuing.
The Gars strategy has assets at 11 September of £22.65bn, analysts at RBC Capital Markets report that the strategy saw net outflows of £593m in August, a better picture than the £641m that left the strategy in July, and the £924m of investor capital that exited the fund in June.
RBC’s analysts said in a note there has been net outflows of £6.8bn from Gars in 2017 year-to-date, they expect net outflows of £10bn from the fund for the 2017 calendar year.
Performance has been weak for the strategy.
Gars has underperformed the IA Targeted Absolute Return sector over the past one, three and five years.
In the past year, it has returned 1.56 per cent, compared with 2.67 per cent for the average fund in the sector.
Gordon Aitken, analyst at RBC, said that a “saving grace” for the fund has been the general poor performance of Absolute Return Strategies, with the average fund in the sector losing money in August.
Over the past five years, the fund has gained 15 per cent, compared with a gain of 16 per cent for the sector as a whole.
As FTAdviser reported in January, the managers of the Gars fund initiated a turnaround plan, which involved increasing exposure to equities.
Mr Aitken said the performance of the Gars fund could have implications for the recently merged Standard Life Aberdeen business, due to the reliance of the company on Gars revenue.
David.Thorpe@ft.com
