Abrdn has been demoted from the FTSE 100 index again after its share price fell by 12 per cent this year.
FTSE Russell, which manages the FTSE indices, announced Abrdn would return to the FTSE 250 index after it reported fund outflows of £4.4bn for the first half of 2023
This is not the first time this has happened to the firm after it suffered the same fate back in August 2022.
A spokesperson for Abrdn said: “We have been in this situation before and subsequently climbed back into the FTSE 100.
“We are confident in our strategy and focused on the things we can control. We are transforming our investments business, growing in the vibrant UK savings and wealth market through Interactive Investor and adviser, and returning significant capital to shareholders.”
Ben Yearsley, investment consultant at Fairview Investing, said: “[This is a] dramatic fall from grace and more importantly value destruction since the merger between Aberdeen and Standard Life.”
Susannah Streeter, head of money and markets at Hargreaves Lansdown, said: "Certainly, sky-high inflation and worries about economic growth have been challenging for the asset management sector, and Abrdn’s weaker performance in this environment looks set to propel it out of the big league.
"The company has shrugged off the potential demotion, remaining confident in its strategy. It has been trying to keep revenue moving in the right direction through acquisitions. It now owns Interactive Investor, which should provide a relatively stable source of assets for the group given its one of the UK's biggest direct-to-consumer investment platforms."
Abrdn, which was previously known as Standard Life Aberdeen, has seen its share price decline since the merger of Standard Life and Aberdeen Asset Management in 2017,
Over the past five years, Abrdn's share price has gone down by 54 per cent.
So far this year, Abrdn's share price has fallen by nearly 12 per cent while the FTSE 100 as a whole has lost just 1 per cent.
Back in July, Abrdn announced it was to merge its Global Absolute Return Strategy fund after a period of poor performance.
Abrdn took the decision to fold the Gars fund, which was once the largest in Britain, into the company's diversified asset funds.
It comes after years of not hitting its own targets with it shrinking to about £1.2bn in size, after having been as large as £20bn in 2018.
Accompanying Abrdn out of the FTSE 100 is Hiscox, chemicals firm Johnson Matthey and house builder Persimmon.
Replacing them are Dechra Pharmaceuticals, products supplier Diploma, Hikma Pharmaceuticals and Marks & Spencer.
amy.austin@ft.com
