Ashmore Group PLC on Friday reported a 7.5% drop in total assets under management in the first quarter of its financial year, as a result of ‘continuing institutional risk aversion’.

The emerging markets-focused investment manager said AuM totalled $51.7 billion at September 30, compared to $55.9 billion at the end of June.

This was the result of a negative investment performance of $1.3 billion and net outflows of $2.9 billion, Asmore said.

Ashmore said its main fixed income and equity strategies ‘modestly underperformed’ over the three months as a result of weaker economic data in China, as well as higher interest rates.

‘Net outflows were at a similar level to the prior quarter, primarily reflecting continuing institutional risk aversion. The outflows were mainly in the external debt and corporate debt themes, with smaller net outflows in blended debt and equities. There were net inflows in the local currency and alternatives themes,’ Ashmore explained.

Chief Executive Officer, Mark Coombs said it was ‘normal’ to see a period of consolidation within a longer recovery cycle, after the previous three quarters of positive returns.

Coombs added: ‘Ashmore continues to deliver longer-term outperformance for clients across a broad range of strategies and is well-positioned to benefit from further recovery in Emerging Markets.’

Shares in Ashmore were down 6.0% at 173.55 pence each in London on Friday morning.

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