Magellan's FUM contracts on loss in global equities

Magellan reported FUM of $68.6 billion at the end of April, down slightly from $70 billion a month earlier.

In an ASX listing on Thursday, Australian equities remained flat at $9.9, while global equities contracted to $38 billion from $39.6 billion, and infrastructure equities ended up 1.0 per cent higher at $20.7 billion.

Retail FUM, which is becoming increasingly crucial for the business, dipped to $24.8 billion on 29 April from $25.7 billion on 31 March. Institutional FUM followed the downward trend, dropping $0.5 billion to $43.8 billion.

Magellan has had a tumultuous year after in February it was announced chief investment officer Hamish Douglass would be taking an indefinite leave of absence on medical grounds. Just months earlier, Magellan suffered a hefty setback when St James’s Place withdrew its mandate worth $24 billion in FUM.

Magellan’s has since shifted its focus to strengthening governance and accountability across the business.

In an investor presentation accompanying the firm’s publication of half-yearly results, Magellan’s new chairman Hamish McLennan hinted that the firm is a lot bigger than Hamish Douglass.

“Let me remind you we have a very robust business,” Mr McLennan said.

“We have a highly experienced longstanding and proven investment team.”

Magellan’s FUM sunk 6.8 per cent to $87.1 billion as at 9 February, on the back of Mr Douglass’ unexpected departure. The firm has since experienced net outflows of just under $20 billion.