LONDON, Oct 14 (Reuters) - Ashmore Group's assets under management fell by $3.1 billion in the third quarter of 2021, it said on Wednesday, after weakness in emerging markets investments led to a few large institutions withdrawing funds.

The UK-listed company said its assets under management dropped to $91.3 billion in the three months to September 30 from $94.4 billion in the prior three-month period.

Net outflows of $1 billion over the period were influenced by a small number of large institutional redemptions but there was also a small net outflow from intermediary retail clients, Ashmore said in its statement.

Ashmore's shares dropped more than 2% in early trading to 316.4 pence - its lowest level since the pandemic market rout in spring 2020. The stock traded at 0757 GMT at 320.8 pence.

"Investors have focused increasingly on the global growth outlook, including the impact of higher commodity prices, supply chain challenges and China's ongoing reforms," Ashmore CEO Mark Coombs said.

However, Coombs added that a number of factors such as rising vaccination rates, easing restrictions and central banks hiking interest rates, making yields more attractive, were not yet reflected in current valuations.

"Core flows remain negative as uncertainty deters client activity," UBS analysts said in a note to clients, adding that outflows had outstripped market consensus threefold and prompted it to lower its 2022 earnings per share estimate by 5%.

Credit Suisse warned in August that Ashmore's exposure to Chinese debt was dragging down its returns.

Researchers at Morningstar said in late September that Ashmore retained significant holdings in debt issued by embattled property giant China Evergrande Group, based on data at the end of August.

The firm - a leading asset manager in emerging markets - has seen its shares drop more than 25% this year following a nearly 17% decline in 2020.

Ashmore said it had won new mandates in external debt, blended debt, local currency and equities in the past three months to end-September, adding demand for investment grade strategies continued to be good. (Reporting by Karin Strohecker; editing by Jason Neely, Elaine Hardcastle)