Magellan (ASX:MFG) posts net outflows of $1.5bn

Investment giant Magellan (ASX:MFG) has posted net outflows of $1.5 billion for the September quater, around 1.3 per cent of average funds under management (FUM).

Magellan shares fell sharply over the last year, down 27 per cent in the last month. The outflows announced this morning comprised net retail outflows of $617 million and net institutional outflows of $910 million, however the company emphasises that they had not lost mandates and the outflows were due to portfolio rebalancing from clients.

Magellan explains that in relation to the institutional outflows, $1 billion of outflows were the result of three clients rebalancing their portfolios across global equities ($410 million), infrastructure equities ($410 million), and Australian equities ($180 million).

Magellan went on to say that all three clients were retained, each with mandates in excess of $2 billion with Magellan at 30 September this year. They also noted that no institutional mandates were lost during the quarter and the global sustainable strategy secured its first two mandates during the quarter.

Around 23 per cent of net retail outflows relate to redemptions from Magellan high conviction trust (MHHT) following the decision to open the fund as an active managed investment (active ETF). MHHT had total FUM of around $889 million at 30 September this year.

Shares Magellan Financial Group (ASX:MFG) are trading 2.5 per cent lower at $33.08.