Aberdeen Asset Management has reported an "encouraging" set of results, but warned that forthcoming elections across Europe and the UK could knock investor sentiment.
The group said "buoyant" markets and the weaker pound helped "cushion the effects" of net outflows, which slowed from £10.5 billion in the last three months of 2016, to £2.9 billion in the three months to March 31.
It also reported a 19.8% rise in pre-tax profits £195.2 million for the six months to March 31, while revenues jumped 10.6% to £534.9 million thanks to "favourable market conditions" and the completion of an efficiency drive set to save £70 million per year.
The news sent Aberdeen shares up 3.7% in midday trading.
Chief executive Martin Gilbert said: "These figures reflect improving sentiment towards emerging markets combined with our transition to becoming a full-service asset manager offering a broad range of capabilities via multiple distribution channels globally."
However, he cautioned that political changes could upend market optimism.
"Global growth appears to be recovering but elections and geo-political issues will continue to weigh on investor sentiment," Mr Gilbert said.
His comments come just a week ahead of the final round of voting for the French presidential election, which could see far-right candidate and Eurosceptic Marine Le Pen put into power.
Investors are also keeping a close eye on Britain's snap General Election on June 8, which could affect the direction of Brexit negotiations.
Attention will then turn to Germany's federal poll, set for September.
Despite its warnings, Aberdeen is still recommending the £11 billion merger with Standard Life, which would create Britain's biggest asset manager overseeing around £660 billion worth of global assets.
Under the terms of the deal, Aberdeen shareholders would own 33.3% of the combined group and Standard Life shareholders 66.7%, with Standard Life chairman Sir Gerry Grimstone set to head up the combined entity.
Mr Gilbert and Standard Life chief executive Keith Skeoch will become co-chief executives of the new firm.
Mr Gilbert said: "Our proposed merger with Standard Life is on track and the combined businesses will form a world-class investment company strengthening further both companies' ability to meet the evolving needs of clients and customers."
Aberdeen said further information on the proposed merger "will be sent to shareholders shortly", adding that the deal is expected to close by the end of September.
The deal is still awaiting approval from both shareholders and regulators.