Man Group saw clients pull out $2.6bn (£1.6bn) of cash in the three months to the end of September, as volatility in world markets knocked the world's largest listed hedge fund manager's recovery from the credit crisis off course.
The company's shares plunged by up to 20 per cent in early trading.
The firm, which had seen $4.4bn of subscriptions in the first half of the year after two years of clients pulling out their money, said total assets under management fell to $65bn at end-September from $71bn at the end of June.
Analysts at Singer Capital Markets had been expecting net outflows of $200 million in the three months to end-September.
"Looking ahead, we are assuming that investor appetite will be generally suppressed for the remainder of the year," said chief executive Peter Clarke in a statement.
Man's total assets under management have rebounded from below $40bn last year, helped by last year's $1.6bn acquisition of GLG and a bumper Japan launch of a version of its flagship AHL fund.
City A.M. Reporter