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£48Bn plunge for fund firms

Leading fund firms lost around £48bn of assets in 2008, with Fidelity International seeing £8bn wiped out, research from Money Marketing has revealed.

Fidelity has seen its retail and institutional funds under management shrink from £29.38bn in December 2007 to £21.1bn at the end of December 2008, a fall of 28 per cent.

Invesco Perpetual, which overtook Fidelity as the biggest UK asset manager at the end of 2007, lost 15 per cent over the same time, with assets falling from £30.4bn to £25.8bn.

A Fidelity spokeswoman says the group’s fall has been broadly in line with the market and it has seen net inflows in recent months. The FTSE 100 fell by 31 per cent over 2008.

Other leading fund managers which bore the brunt of the financial crisis last year include Legg Mason, which saw its assets fall by 51 per cent from £751m to £364m, and Rathbones, which saw its assets fall by 49 per cent from £1.71bn to £877m.

Rathbone marketing manager David Holloway says: “Our strength has been equity income and value funds in general and this is the area of the market that has felt the credit crunch hardest. However, we do feel we are on the cusp of a change in sentiment as those areas move back into favour.”

Other groups to see over 40 per cent falls in assets include the likes of SVM, Credit Suisse Asset Management Funds UK and New Star.

Of the leading 25 fund firms only Neptune Investment Management managed to produce a positive return, having grown its assets by 4.81 per cent in 2008.

Skerritt Consultants head of investments Andrew Merricks says: “Ideally, this is not what you want to see but a lot will depend on where the assets actually sit within inv- estment houses. Investment management is about defen- ding assets in the bad times as well as growing them in a bull market.”

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