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Invesco's October AUM Decreases 5.6% on Unfavorable Markets

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Invesco's October AUM Decreases 5.6% on Unfavorable Markets

Decline in assets under management will likely hurt Invesco's (IVZ) revenues to some extent.

Invesco Ltd. IVZ announced its assets under management (AUM) for October 2018. The company’s preliminary month-end AUM of $926.1 billion declined 5.6% from the prior month.

Unfavorable market returns, net long-term outflows and non-management fee earning AUM outflows were the primary reasons behind the decline in total AUM. Also, foreign exchange dragged down the month’s AUM by $3.9 billion.

October’s AUM also reflected a $5.4 billion low-fee institutional outflow. However, these were partially offset by rise in Money Markets AUM and reinvested distributions.

Invesco’s preliminary average total AUM for the quarter through Oct 31 was $946.2 billion while preliminary average active AUM was $704.7 billion.

At the end of the reported month, Invesco’s Equity AUM fell 9.3% sequentially to $417.9 billion. Moreover, Balanced AUM of $53.8 billion decreased 5.6% from the September 2018 level.

Further, Fixed Income AUM decreased 3.5% from September to $226 billion. Also, Alternatives AUM fell 2.2% sequentially to $139.6 billion. However, Money Market AUM of $88.8 billion grew 2.9%.

Steady decline in AUM over the past few months, mainly due to unfavorable market conditions, is a major concern. This will likely hamper revenue growth to some extent. All these matters seem to be dampening investors’ sentiment at present.

So far this year, shares of Invesco have lost 43.9% compared with 20.8% decline recorded by the industry.

Invesco currently has a Zacks Rank #3 (Hold).You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Performance of Other Asset Managers

Franklin Resources BEN announced preliminary AUM by its subsidiaries of $682.7 billion for October. Results reflect a decline of 4.8% from $717.1 billion recorded as of Sep 30. The fall was primarily due to market declines and net outflows.

Cohen & Steers CNS reported preliminary AUM of $57.8 billion as of Oct 31, 2018, down 3.7% from the prior month. Market depreciation of $1.8 billion, net outflows of $275 million and distributions of $200 million were the reasons for the decline.

T. Rowe Price Group, Inc. TROW announced preliminary AUM of $1.01 trillion for October 2018. Results reflect marginal fall from $1.08 trillion recorded on Sep 30, 2018.

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