LONDON (Reuters) - Shares in British hedge fund Man Group (L:EMG) rose 4 percent on Friday after a rise in third quarter assets and a new share buyback was announced.
Man Group assets rose 7.9 percent in the three months ending Sept. 30, boosted by market gains and net inflows to its funds, including in emerging market debt.
Total assets rose from $95.9 billion at the end of June to $103.5 billion at the end of September, at the top end of consensus figures that ranged from $98.2 billion to $103.5 billion.
The firm took in $2.8 billion in fresh investor cash, generated $900 million in currency gains and $3.3 billion from positive investment movements, it said.
Man Group also announced a new $100 million share buyback after concluding its last one around the same time last year, according to an analyst note from Credit Suisse (SIX:CSGN).
"Man has again proven itself a shareholder friendly allocator of capital," said the note.
Among Man Group's business to increase assets, the long-only stock-picking unit rose by 11 percent to $19.7 billion, with investors adding $600 million to emerging market debt strategies and $500 million to the European equities strategy.
Flows were partially offset by $400 million of redemptions pulled from funds of funds and $400 million from equity long short strategies as well as $300 million yanked from computer-driven strategies.
In a reversal of an earlier decision, Man Group said it would absorb research costs for the majority of its business in 2018 under MiFID II reforms, estimating the impact to the business to be about $10 to $15 million.
"Whilst we did not think it was inevitable that liquid alternative managers would absorb research costs in the near term, we view this as a sensible decision for the business," said the report from Credit Suisse. "It could, arguably, also be a modest competitive advantage for Man if its unlisted
competitors do not follow suit."