New Star Asset Management has reassured that trading conditions in the first half of this year have been “generally buoyant”, despite unsettled equity and bond markets last month.

In a trading statement, the fund manager, founded seven years ago by John Duffield, said that it “continues to maintain its sales momentum. Subject, as always, to securities markets and unforeseen circumstances, New Star is well on course for another year of strong growth.”

A downturn in US sub-prime mortgage-backed securities and European corporate-debt markets had raised concerns over the performance of fund managers and intermediaries with exposure to fixed-income assets.

Such concerns lay behind a weak stock market debut on Thursday for MF Global, the brokerage division of Man Group, the hedge fund manager.

New Star said that assets under management rose 17 per cent to £24.7 billion in the six months to June, modestly below the £24.8 billion reported at its annual meeting in May.

However, net inflows of assets during the period were £2.3 billion — a near-threefold rise on the first half of 2006 — helped by the launch of its International Property Unit Trust.

New Star described its investment performance as “healthy”, with 38 per cent of its equity and bond mutual fund assets in funds in the top quartile of their respective peer groups.

This month New Star changed the pricing of the units in its UK Property Unit Trust from offer to bid in an attempt to stem an outflow of funds.

It described the measure as “normal practice” in the UK mutual fund industry.

Tempus: Star gazing

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