The rising tide of global stock markets has lifted the shares of Europe’s asset management firms this year. Hedge funds, though, remain the industry’s problem child – hence the relative underperformance of Man Group Plc, the world’s biggest publicly traded hedge fund.

Figures released on Thursday showed Man suffered net outflows of $700 million in the first three months of this year, driven by customer redemptions of $8.6 billion that analysts at UBS AG calculate to be the worst ever for the firm. Man warned at the start of March that it was still seeing clients pulling cash; that trend seems to have continued through the month.

It’s not all bad news. The firm’s traders took advantage of rallying markets to deliver positive investment performance worth $4.5 billion in the quarter, driving a modest 3.5 percent gain in assets under management to $112.3 billion. That’s still down, though, from the $114.1 billion that the firm oversaw at the end of September.

Last month, Man cut its goal to increase assets under management each year to between 1 percent and 6 percent from as much as 10 percent previously “to better reflect industry trends and the market environment.” So the company has conceded that it’s unlikely to revisit the 2018 inflows that were equal to 9.9 percent of assets, never mind the record 15.8 percent growth in 2017.

“We expect clients to continue adjusting their portfolio allocations during the second quarter,” Chief Executive Officer Luke Ellis warned on Thursday. The firm remains at the mercy of the markets and the smarts of its traders for generating asset growth as customers remain averse to allocating money to hedge funds. With a slowing global economy and the now ever-present risk of trade wars erupting, that’s not a very comfortable position to be in.

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Mark Gilbert is a Bloomberg Opinion columnist covering asset management. He previously was the London bureau chief for Bloomberg News. He is also the author of “Complicit: How Greed and Collusion Made the Credit Crisis Unstoppable.”

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