The firm said the record FUM was driven by market performance, partly offset by a rise in customers withdrawing cash from its funds. A year earlier, it held £212.4bn as of September 30.

It attributed the 14.2% increase in FUM to improved market performance, with £1bn of investment returns in the quarter, bringing returns for the year to date to £19.1bn.

The group said in its accounts that investors moved away from riskier assets as the Iran war and a global bond sell-off hit market sentiment and reduced trading activity.

Gross inflows reached £5.1bn in the quarter, down from £5.7bn the previous year. Client retention remained steady at 95.1%, while outflows were stable at 5.1% of FUM, down slightly from 5.2% last year.

The group also increased its exposure to North American equities to 40% of its portfolio, or £95.5bn, and raised its investment in Asian equities by 14% to £38.7bn. UK assets remained a small part of the portfolio at around 8%, or £20.3bn, while European equities made up 12%, or £29.4bn.

Chief executive Mark FitzPatrick said: “During the period, our advisers have been active supporting clients through market volatility and providing guidance ahead of the Autumn Budget. Against this backdrop, we attracted £5.2bn of gross inflows during the quarter, bringing total gross inflows to £15.6bn year to date. While lower than the exceptionally strong comparative period last year, which benefited from high levels of activity linked to the implementation of our new charging structure, the quarter demonstrated the continued strength of our partnership.

“Another quarter of net inflows, together with positive investment returns for clients, saw funds under management reach a record £242.4bn. Net inflows were lower than in the prior year, reflecting the strong comparative period. Outflows were broadly stable relative to funds under management, with client retention remaining high at 95.1% year to date.

“Alongside our trading performance, we continue to make progress in delivering our strategy. Over the past two years, we have simplified the business, improved efficiency and created greater capacity to invest for the future. We continue to invest in the areas that will drive future growth, including enhancing the proposition and experience for clients, strengthening the support we provide to the Partnership, and using technology and AI to improve productivity across the business.

“Building on the stronger foundations we have established, we remain confident in the significant long-term opportunity for financial advice in the UK and in our ability to capture it. We look forward to providing more detail on Amplify, the next phase of our strategy to deliver sustainable long-term growth, at our full-year results in February.”