New Star Asset Management Group says that trading has been ‘buoyant' in the first half of 2007, despite unsettled equity and bond markets.
The group reports that assets grew to £24.7bn by the end of June 2007, a 17% increase on the £21.2bn worth of assets under management recorded at the end of 2006, but slightly lower than figures for May.
Net asset inflows in the first half of 2007 hit £2.3bn, compared with £851m during the same period last year, indicating that rumours of a slowing economy have not deterred investors.
Mututal funds have received considerable interest during the past six months. At the end of 2006, New Star’s international mutual funds were managing around £1.1bn, but by the end of June 2007 this had risen 82% to £2bn.
New Star also reports healthy investment performance, with 38% of equity and bond assets held in funds in the top quartile and 65% in the top two quartiles. Hedge funds also performed well with 80% of funds in the top two quartiles relative to Eurohedge peers.
The strong growth of investment indicates that signs of an economic downturn have not significantly dented investor confidence. It remains to be seen whether recent rate rises have caused a significant decline in consumer spending, which analysts say could lead to a dampening of economic growth in the long term.
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