A quoted investment vehicle advised by Man Group has been sucked into the unfolding story of troubled hedge fund Amaranth which has lost $4 billion betting the wrong way on gas prices.

Man Alternative Investments told the stock market this morning that it held one of Amaranth's hedge funds in its portfolio. It said the holding constitued 2.35 per cent of its assets as at the end of August.

The precise size of Man Alternative's assets under management is not known, although it is thought to be about £30 million.

Man said, however, that its previous year-to-date investment return on the fund of 5.93 per cent would fall by 1.44 per cent as of the beginning of this week.

But it added: "However, it is not possible at this stage to calculate precisely the effect which the losses sustained by Amaranth will have on the company's net asset value going forward."

The disclosure underscores the uncertainty gripping the hedge fund world after Amaranth's revelation at the beginning of the week.

The hedge fund had bet that gas prices would remain high, but they dropped on easing supply concerns and optimistic seasonal weather forecasts.

Yesterday Goldman Sachs disclosed that it invested $25 million into Amaranth just weeks before the losses were sustained. Goldman Sachs's Dynamic Opportunities trust said its overall return for September would fall by between 2.5 and 3 per cent, implying losses of up to $15 million.

Nine investment banks that act as prime brokers, or lend money to Amaranth, are thought to have been drawn into the affair. However, it will be investors in the funds will suffer any eventual losses.

Man Alternative is a separately quoted entity from Man Group and no representative was made available to comment.

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