Man Group has changed dramatically from its founding over 200 years ago and grown from its roots of being awarded an exclusive contract to supply rum to the Royal Navy. As of March 31, the firm had $175.7 billion in assets under management across alternatives products including hedge funds, multimanager solutions and long-only strategies, up from $167.5 billion at the end of 2023. Institutional investors make up approximately 80% of the firm’s assets under management.
Man Group reported that client outflows totaled a net $1.6 billion during the first quarter of this year, but investment performance compensated with an increase of $9.8 billion.
Grew believes the current moment of major wars, global elections, a market environment that looks different from the last decade and uncertainty about interest rates favors active management.
These are times when, “active asset managers can lean in and can add value, where all of the effort and all of the acumen and depth of experience we have across the organization can be put to work,” she said.
Grew first joined Man Group in 2009 and served in multiple roles before becoming CEO on Sept. 1, 2023. She thinks that increasingly the future of asset management will be in customization and working with clients on their specific needs.
Grew is focused on the firm’s investor base and used the words client or clients over 60 times during an hourlong interview.
“Two-thirds of our AUM is now customized in some format and a subset of that is really, really customized,” Grew said. “We see that as a direction of travel. We see that more and more the need is to try and address the particular challenge that a client might face.”
And these days investors are facing challenges including volatility, wider dispersion, balancing liquidity and duration all amid a different market environment. Grew argues that the last 10 years may have been an “aberration rather than the law” and that in the current environment, investors with diversified portfolios need to be prepared to have parts perform while others may not.
“Getting used to parts of your portfolio performing at one time and not at another time, bearing in mind, if you’re an asset holder for the last decade or so, you did just fine, risk adjusted or otherwise, you did just fine,” she said. “But recognizing that in a true portfolio that is diversified, you are going to see parts of that portfolio perform and you should be seeing parts of that portfolio not performing. That is the point about weathering volatility and market cycles.”
Grew said Man is fielding more questions around portfolios that can perform through different market environments with investors thinking through correlation risks.
“So active, for sure, credit, for sure, risk free, for sure,” she said. “And getting it in the right combination with the right duration. And then working out whether they want to have any other specific tail protection or overlay.”
Fewer managers
For the hedge fund industry specifically, Grew expects that the next decade will mean investors wanting to work with fewer managers, and get more from them.
Man Group made acquisitions last year bringing on U.S. middle-market private credit manager Varagon Capital Partners and acquiring a 51% stake in Geneva-based ESG manager Asteria.
Grew is focused on both organic growth within the firm’s current lineup and is also keeping an eye out for other acquisition opportunities. “This isn’t about running a single fund. It’s about continuing to evolve,” she said, joking that if Man hadn’t continued changing they’d still be making rum barrels on the side of the River Thames.
“We would like to see whether there are more acquisitions we can do, particularly in private credit, particularly in the U.S. Why? Very simply because we believe in continuing to develop and enhance the content we have so that we are more useful, more relevant to our clients,” she said.
Man Group has credit funds in liquid format, in the quant space and now the private space, Grew said. Assets total $28.1 billion across the credit offerings.
“And we want to continue to grow what we think is not a trade, but a strategy and an opportunity. And something in which our clients are interested in,” she said, adding that credit offers different opportunities “through the entire credit curve” with “interesting” returns.
But there’s one area that Grew won’t be looking at for acquisitions.
“We’re never going to buy a sports team,” she said with a laugh.
