Magellan sees 17% global equity FUM loss

Magellan boards fund flows

9 October 2023
| By Laura Dew |
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Magellan Financial Group has seen funds under management decline in September with the largest loss in the global equities division. 

In an announcement to the ASX, the firm said FUM declined from $39 billion to $35 billion in September.

This is divided between $16.2 billion in retail and $18.8 billion in institutional, down from $17.5 billion and $21.5 billion respectively at the end of August.

Overall net outflows were $2 billion, with net retail outflows of $0.3 billion and net institutional outflows of $1.7 billion.

The asset manager had previously seen a brief return to inflows in the institutional space during August when it saw net institutional inflows of $0.1 billion.

Within various asset classes, global equities declined by 17.7 per cent from $18.6 billion to $15.3 billion. 

The Magellan Global Fund returned 20.1 per cent over one year to 31 August versus returns of 22.4 per cent by the MSCI World benchmark over the same period. However, in its annual results, Magellan said it had generated $11 million in performance fees in the 12 months to 30 June 2023.

In infrastructure, it declined slightly by 3.8 per cent from $15.7 billion to $15.1 billion while Australian equities declined from 2.1 per cent from $4.7 billion to $4.6 billion.

Both global and Australian equities had seen inflows during August.

The firm had made several leadership changes over the last few months as part of a board renewal process.

This board renewal process was implemented to ensure the board has the right skill mix, independence, diversity, expertise and knowledge of the financial services and investment management industries. 

Former Janus Henderson CEO, Andrew Formica, was appointed as non-executive director in July and was later appointed as non-executive chair to replace Hamish McLennan. It also appointed Cathy Kovacs and Deborah Page as non-executive directors. 

Kovacs has been a non-executive director of HUB24 since July 2021 and previously held senior roles at BT, Macquarie, Ellerston Capital and Westpac, while Page is a former chair of Pendal Group.

Kovacs will take over as a non-executive director on 6 November from Colette Garnsey, who has informed Magellan of her intention to retire from the board after the AGM on 8 November. 

It also changed the investment leadership with Gerald Stack moving from deputy CIO with David George to head of investments.

“As a result of structural improvements in the investment team, we announce we will revert our investment team leadership to its former ‘business as usual’ structure with David as CEO and managing director and Gerald as head of investments,” the firm stated.

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