UPDATE 4-Man Group year profit surges 60 percent
(Writes through with Fink detail; updates shares)
LONDON, May 29 (Reuters) - Man Group (EMG.L), the world's biggest listed hedge fund company, posted a 60 percent rise in annual profit on Thursday, riding turbulent financial markets to show growth in funds under management which fuelled record fees.
It also said its Deputy Chairman Stanley Fink, one of Europe's best known hedge fund figures, would leave the company in July after 21 years to devote more time to his other business and charitable interests.
Fink, one of the hedge fund industry's strongest advocates, was Man chief executive between 2000 and 2007, when he oversaw its rapid expansion before handing over the reins to Peter Clarke.
Clarke told Reuters a key part of the strong results stemmed from the performance of its AHL futures business, which with no exposure to equities, proved particularly successful during the intense volatility in stock markets over the past nine months.
"Diversification and low correlation is a key to surviving these markets," Clarke said.
Man's conservative product range with low leverage had also seen it attract funds as fears intensify over the gearing of other hedge funds at a time when the credit crisis bites harder.
The hedge fund industry is able to generate high returns during market downturns by using leverage, as well as swaps and short-selling shares.
Man made profit before tax from continuing operations of $2.08 billionin the year ended March 31, driven by a 161 percent increase in net performance-fee income. It made $1.3 billion the previous year.
Funds under management rose 21 percent to $74.6 billion by the end of the period and rose further in the first two months of the current financial year to an estimated $78.5 billion at the end of May, including the launch of a $1 billion Asian fund.
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It won more institutional business in the United States and Clarke also attributed its strong sales -- which at $16 billion equalled 2007's record performance -- to its geographic reach, with mature business in Asia Pacific and the Middle East.
"We have a long-established base in those parts of the world where wealth is currently being accumulated, either through high commodity prices or through trade," Clarke said.
Investors in these regions were looking at hedge funds as a means of diversifying their portfolios away from property or private equity, Clarke said. Continued...
