Jupiter Fund Management (JUP.L) experienced a historic low in its stock value on Tuesday, as it grappled with significant net outflows in the third quarter of the year.
These unexpected outflows were exacerbated by subdued interest from retail investors and the turbulence of markets amidst soaring inflation rates.
In this quarter, Jupiter recorded net outflows totaling £1 billion ($1.22 billion) for the period ending September 30, a figure that exceeded analyst predictions of £600 million.
Consequently, the company’s stock plummeted by 11% at 0815 GMT.
This downturn comes on the one-year anniversary of Matt Beesley’s appointment as CEO and follows a year marked by substantial changes at Jupiter.
These changes included streamlining their fund offerings, a necessary step in the fiercely competitive UK funds industry.
By the end of September, assets under management had decreased to £50.8 billion from £51.4 billion at the end of June.
On a positive note, the firm reported institutional assets under management of £9.8 billion, surpassing consensus expectations of £9.6 billion.
Jupiter also expressed confidence in securing additional mandates in subsequent reporting periods.
The market’s volatility, driven by geopolitical tensions and persistent inflation in the UK, has prompted some investors to adopt a cautious approach.
Many are divesting from UK and European equity funds, instead opting to park their capital in money market and high-quality bond funds.
Despite these challenges, CEO Matt Beesley remained optimistic about the company’s performance.
He stated, “Despite the challenging market environment, we expect our financial performance for the current year to be in line with expectations.”
He also highlighted the encouraging growth of their institutional and international businesses as signs of their ability to expand their appeal to a broader clientele.
In unrelated news, wealth manager St James’s Place reported a significant drop in net inflows for the third quarter, with figures halving to £910 million from the previous year.
However, their funds under management increased slightly, reaching £158.57 billion at the end of September compared to £157.5 billion at the end of June.