Polar Capital hits £25bn as emerging market fund stars

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Polar Capital’s emerging markets team took the baton from its technology arm to propel the group towards the £25bn mark.

According to a trading update covering the six months to the end of September, Polar’s assets under management rose by 12% year-on-year to £23.4bn. The firm added assets breached £25bn on 12 November.

A net inflow of £690m and £1.8bn relating to market movements fuelled the AUM increase during the reporting period.

Pre-tax profit rose 17% to £31.7m, while the dividend was raised from 9p to 14p.

At 8.45am, shares in Polar were up 1.1% at 828.94, 14.7% beneath the 52-week high they hit in the summer.

A major driver of inflows was the sustainability-oriented Emerging Markets Stars fund, which attracted a £366m net inflow in the six months. Managed by the Citywire AAA-rated duo of Jorry Rask Nøddekær and Naomi Waistell (pictured), the fund has returned 75% in the three years to the end of October, more than double the peer group average of 35.3%.

The firm’s Biotechnology fund and Convertibles team also attracted new cash, pulling in £199m and £85m respectively, while the Polar Capital Global Financials Trust raised £154m through a share issuance.

However, it was not a great six months for the firm’s technology division, which had powered the firm to its largest-ever annual assets increase in 2020. The firm’s flagship Technology fund, which was soft-closed in 2020, suffered an outflow of £413m during the six months, with the A&AI fund losing £49m.

Polar said the Technology fund suffered from clients moving away from the tech sector and bagging profits after an outstanding 2020 were the major factors behind this reversal.

The firm’s UK Value Opportunities fund, also soft-closed in 2020, suffered modest net outflows of £18m in the period, although the team benefited from the funding of a segregated mandate amounting to £169m.

Meanwhile, its North American fund, which has suffered sustained prior periods of net outflows, saw this trend reduce with net outflows falling to £33m.

Polar CEO Gavin Rochussen (pictured) believes the firm’s broad fund range can help the business continue to navigate turns in sentiment.

‘Our diverse and differentiated range of sector, thematic and regional fund strategies and our performance-led culture where 74%, 93% and 99% of our AUM is in the top two quartiles against peers over three years, five years and since inception respectively, together with significant remaining capacity, provides confidence that momentum will continue,’ Rochussen said.