The investment manager experienced net inflows of $206 million over the month of March, with $221 million in institutional inflows making up for $15 million in net retail outflows.
The retail division did see a rise overall during the quarter, with there being $773 million in net inflows for the segment, as there was $346 million in net institutional inflows.
But the resulting $1.1 billion in net inflows still fell short of Morgan Stanley’s $1.85 billion forecast.
“With investment performance remaining soft and the stock still dear versus peers… we see better value elsewhere and remain [underweight],” a new research note has stated.
As outlined by Morgan Stanley analysts, the retail inflows of $773 million were almost half of its projected $1.36 billion for the quarter.
But Magellan’s $106 billion in funds under management (FUM) as at the end of March, following on from $100.6 billion at the end of February, had come out higher than Morgan Stanley’s anticipated $102 billion.
The group had $77 billion in FUM from its institutional clients, while overlooking $29 billion for the retail segment.
Overall, there had been growth across FUM in Magellan’s global, infrastructure and Australian equities sections, but the Morgan Stanley note pointed to a slowdown in performance.
“Performance remains soft in the Global Fund with -3 per cent [versus benchmark] over three months, -19.3per cent over one year, 1 per cent over five years,” the analysis added.
“Performance has modestly improved but is still soft in the Infra Fund with -1.3 per cent [versus benchmark] over three months, -15 per cent over one year, 0.2 per cent over five years.”
The investment manager also declared it would be switching from monthly to quarterly flow reporting, reducing disclosures but staying consistent with peers, Morgan Stanley noted. Meanwhile it will continue to report FUM monthly.
Sarah Simpkins
Sarah Simpkins is a journalist at Momentum Media, reporting primarily on banking, financial services and wealth.
Prior to joining the team in 2018, Sarah worked in trade media and produced stories for a current affairs program on community radio.
You can contact her on [email protected].
