Lower assets under management posed challenges for Premier Miton in the first half of 2024, according to Peel Hunt analysts.
The analysts said being overweight to UK equities has had an impact on the firm.
In the first half of 2024, average AUM was 10 per cent down on the same period the year before.
In a note today (June 5) Peel Hunt analysts, Robert Sage and Stuart Duncam, said: "PMI’s flows have remained negative in nine of the past 10 quarters, as it has been exposed to a combination of factors that have proved challenging.
"[Including] being overweight UK equities, together with high exposure to UK retail investors, whose capacity to invest has been impacted by cost-of-living pressures, and whose propensity to invest in equities has been weakened by the availability of higher interest returns on deposits (and gilts) following rises in UK interest rates."
Premier Miton published its results for the six months to March 31 on Thursday (May 30).
CEO Mike O'Shea, said the group's closing AUM of £10.7bn was up 9 per cent compared with the start of the financial year.
He said: "The backdrop for active fund sales in the UK retail market has been challenging over the Period, as it has been since interest rates began to rise at the end of 2021.
"We are now at a point where interest rates are likely to trend lower as we move through 2024 and we believe this will support an improving environment for fund flows and asset values.
"Demand for savings products will remain high as savers and investors need to do more to secure their individual long term financial futures.
"Active managers such as Premier Miton have a role to play in managing these savings. To do so, our funds must demonstrate that they can add value, over and above the returns from the major indices, by having robust investment processes; well-researched portfolios, often with high active shares and high tracking errors; and by delivering out-performance."
The results came a day after the firm closed its European Sustainable Leaders Fund due to its small size.
tara.o'connor@ft.com
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