Institutional outflows lessen at Magellan

7 November 2023
| By Laura Dew |
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Magellan experienced outflows of $800 million in October to bring total funds under management to $34.3 billion.

In its monthly update, the firm said total funds under management were $34.3 billion, down from $35 billion in the previous month. 

Outflows were divided between $0.5 billion from the institutional channel and $0.3 billion from retail investors. 

However, this was an improvement on September’s figures when institutional outflows were $1.7 billion which caused institutional FUM to fall by more than 12 per cent from $21.5 billion to $18.8 billion.

As a result of the October outflows, institutional FUM fell from $18.8 billion to $18.2 billion and the retail FUM fell slightly from $16.2 billion to $16.1 billion.

Breaking it down by asset class, global equities fell from $15.3 billion to $15.2 billion, infrastructure equities fell from $15.1 billion to $14.8 billion, and Australian equities saw the largest fall of 6 per cent from $4.6 billion to $4.3 billion. 

At the start of 2023, Magellan’s FUM was $45.3 billion so this year has represented a loss of $11 billion so far, but this is more muted than in 2022 when the exit of Hamish Douglass prompted losses from $95.4 billion to $45.3 billion, a halving of its assets.

October saw the fund manager lose its chief executive and managing director as David George, who held the role for just over a year, left with immediate effect

In a statement to the ASX, executive chair Andrew Formica said: “The board, in consultation with David, believe it is time to refocus leadership which will accelerate the progress made to date. The board remains focused on the delivery of exceptional investment performance and are well positioned to continue to explore organic and inorganic growth opportunities. 

“I am personally committed to the task of leading Magellan until such time a new CEO can be appointed.”

George was brought on board in May 2022 from the Future Fund, receiving a base salary of $1.8 million, as the asset manager looked to rebuild in the wake of Hamish Douglass’ temporary leave of absence.

His role was later expanded to include chief investment officer in October 2022 but he stepped back from the role in August 2023.

 

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