12:42 noon - Here are some reasons why you should invest in Man Investment Hedge Fund .

Man Group Says Annual Profit Tops Analysts' Estimates (Update2)2008-03-27 04:48 (New York)

(Adds fees in seventh paragraph.)

By Tom Cahill March 27 (Bloomberg) -- Man Group Plc, the world's largestpublicly traded hedge fund manager, said annual earnings willexceed analysts' estimates, helped by rising performance fees. Profit before tax in the year ending March 31 will surpass$1.82 billion, the average estimate of 13 analysts surveyed bythe company, London-based Man Group said today in a statement.Man earned $1.3 billion in the previous 12 months. Man Group's flagship $3 billion AHL Diversified Plc fundrose 23 percent from a year ago, beating the 10 percent gain forthe Credit Suisse/Tremont Hedge Index and boosting fees tied toperformance. Man uses the AHL trading system to manage at least$21 billion in total. Peter Clarke, who took over in April aschief executive officer, said the company is ``extremely wellplaced'' for further growth. ``They've had spectacularly great performance with AHL,''said Jason Streets, head of research at Evolution Group Plc inLondon, who has a ``buy'' recommendation on the shares. ``Theinteresting thing is there's nothing about performanceelsewhere.'' Man Group rose 7 pence, or 1.3 percent, to 552.5 pence by8:30 a.m. in London trading. The stock has declined 2.7 percentthis year, the fourth-best performance in the 60-member BloombergEurope Banks and Financial Services Index.

Assets Rise

Man said investors added $15.8 billion to its funds in theyear, while redeeming $10.6 billion. Total assets undermanagement rose 4.6 percent to a record $75 billion, comparedwith $71.7 billion at the end of 2007. Net sales, or sales lessredemptions, were $900 million in the first three months of 2008,the statement said. Net management fee income will rise by more than 15 percentfrom the previous year, Man Group said. Hedge funds typicallykeep 20 percent of investment gains as performance fees. Man saidperformance fees will be ``up strongly over last year and aboveexpectations,'' without providing a specific figure. Streets at Evolution said the management fees and assetsunder management were ``slightly below'' his estimates. He hadprojected profit before tax of $2.06 billion. Hedge funds are mostly private pools of capital whosemanagers participate substantially in the profits from theirspeculation on whether the price of assets will rise or fall.They typically seek clients with at least $1 million to invest. Man, which started as a sugar trader in 1783, raised $2.9billion last year in the initial public offering of its MF GlobalLtd. brokerage unit.

--Editor: Frank Connelly, Mike Anderson