Polar Capital's asset pool shrunk to $12.3 billion at the end of last month, the group reported to the London Stock Exchange.

Polar Capital's assets under management dipped 7 per cent year-on-year to $12.3 billion at the end of March.

The asset manager's poor performance in Japan drove the near $1 billion fall from $13.2 billion at the end of March 2014. 

The Japan business suffered $2.3 billion of outflows, which far outweighed the $0.3 billion generated in net inflows across the group's non-Japan fund range. Polar Capital said the “disappointing performance” had been “exacerbated by the team's style bias, as well as uncertainty over the direction of the Japanese equity market”.

“These Japan flows follow the $3.0 billion of net inflows that were received in the previous twelve month period,” the group said in a statement to the London Stock Exchange.

Long-only fund assets, which make up the bulk of the group's total asset pool, slid by 9 per cent over the year to $11.2 billion at the end of last month in spite of a $1.1 billion contribution from market movement and performance.  

Meanwhile, the alternative fund business saw inflows of $254 million during this period, taking it over the $1 billion mark at the end of March 2015.

“We continue to believe that over the medium term the group is well placed to grow assets further given the number of products that have considerable scope for asset growth including the launch of three new funds over the past year.”

Polar Capital, based in London, also has offices in Tokyo, Connecticut, Jersey and Geneva.