Sterling weakness gives Polar Capital a boost

Specialist asset management group Polar Capital Holdings posted a quarterly update of its unaudited assets under management on Thursday.

The AIM-traded firm reported assets under management of £7.7bn at 30 september, compared to £7.3bn at the end of March.

It did point out, however, that the improvement was almost entirely due to the weakness in sterling since the Brexit vote and the rise in global markets over recent months.

“We have continued to experience net fund outflows over the period, predominantly from our Japan UCITS fund, although we also experienced outflows in a number of other funds particularly in July in the immediate aftermath of the Brexit vote,” the board said in a statement.

Polar’s Japan funds fell to 14% of AUM, although it was anticipating further outflows if the team's approach continued to remain out of favour.

“Despite the disappointing performance over the last five years the fund remains top decile in its peer group since launch and we believe those investors who can take the longer term view will be rewarded over time from current levels.”

It said that over the first six months of the financial year, the overall backdrop for flows into equity funds remained poor in both the UK and continental Europe.

“Industry data indicates that outflows from long only equity funds in July were in excess of those experienced at the height of the 2008 financial crisis.

“Despite this unhelpful background, we have been encouraged by increased interest in a number of our UCITS strategies including Technology, Healthcare, Insurance, UK Absolute, Global Convertible Bond and European ex-UK Income.”

Polar Capital’s board did note that at the end of September nine of its funds were in performance fee territory.