Man Group, the world's largest listed hedge fund, has reported a decline in profits despite posting a sharp 35% rise in assets under management during 2025 to a record high $227.6bn, on the back of strong inflows and market gains.

Profit before tax fell 14% to $407m as volatile market conditions weighed on performance earlier in the year. Both figures nevertheless came in ahead of analyst expectations.

Chief executive Robyn Grew said results reflected a difficult first half followed by a much stronger second half, as some strategies struggled to adapt to fast-changing market conditions before rebounding later in the year.

“We ended the year with positive momentum, delivering good performance across a range of key strategies including liquid credit, quant equity and our multi-strat, and gained market share for the sixth consecutive year.

While many systematic hedge funds were sharply negative by mid-year, Man Group’s flagship AHL strategies finished 2025 up more than 5%. Its multi-strategy fund, Man Strategies 1783, delivered a 14% gain for the year.

Across the wider industry, hedge funds returned about 12% in 2025, according to PivotalPath, while systematic peers averaged gains of around 2.4%, data from Société Générale showed.

Despite higher assets, Man Group’s core net management fees slipped 2% to $1.1bn, reflecting fee pressure and strategy mix. Headcount also edged lower to 1,719 at the end of December.