The market may be pushing higher today but the same cannot be said for the Magellan Financial Group Ltd (ASX: MFG) share price.
In early trade, the struggling fund manager's shares were down as much as 6% to $11.51.
The Magellan share price has recovered a touch since then but remains 2.5% lower at $11.96 at the time of writing.
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Why is the Magellan share price under pressure?
Investors have been selling down the Magellan share price again this morning after the embattled fund manager released its latest funds under management (FUM) update.
As you might have guessed from the reaction by investors, that update wasn't a very positive one. In fact, Magellan revealed that its FUM continues to bleed out.
According to the release, Magellan's FUM stood at $61.3 billion at the end of June. This is down 5.7% from $65 billion at the end of the previous month.
As shown below, the company saw its FUM fall across the board.
- Global Equities FUM fell 5.4% to $33.3 billion
- Infrastructure FUM was down 2.9% to $20.1 billion
- Australian Equities FUM dropped 13.2% to $7.9 billion
What happened?
Management advised that this reflects unfavourable market movements and net outflows across both retail and institutional channels. It explained:
The change in FUM over the June quarter comprised market movements (reflecting recent volatility and foreign exchange) and net outflows. For the June quarter, Magellan experienced net outflows of $5.2 billion, which comprised of net retail outflows of $1.7 billion and net institutional outflows of $3.5 billion.
The company also provided an update on its performance fees for FY 2022. It revealed that it is entitled to estimated performance fees of approximately $11 million for the year ended 30 June 2022. This is down from approximately $30 million a year earlier.
The Magellan share price is now down almost 40% in 2022.
