* AuM $75 bln from $70.1 bln in March quarter
* Boosted by net inflows, investment performance
* Equity, bond funds draw in new money
* External debt, liquidity funds see outflows
* Shares up more than 4 pct (Adds detail on performance, background)
By Simon Jessop
LONDON, July 10 (Reuters) - Fund manager Ashmore Group said on Thursday that assets under management increased during its fourth quarter, partly reflecting improving investor sentiment towards emerging markets.
Emerging-market-focused Ashmore said assets under management rose to $75.0 billion at the end of the three months to June, up from $70.1 billion in the previous quarter which had been hit by large client outflows.
The group's shares were up more than 4 percent by 0706 GMT.
The increase in assets came through a combination of net inflows totalling $1.6 billion and positive investment performance of $3.3 billion, it said.
"Improving sentiment and the consequent market recovery have benefited those investors who remained focused on the economic and political fundamentals in emerging markets and who took the opportunity to invest in mis-priced assets earlier in the year," Chief Executive Mark Coombs said in a statement.
Investors have turned more positive on emerging markets this year after a pull-back in 2013 in response to uncertainty over a potential tightening U.S. monetary policy and slowing China growth.
Ashmore said new money entered a range of its fixed income and equities funds, although there were net outflows from its external debt and overlay/liquidity funds.
An improvement in the performance of Ashmore's investments also helped buoy assets under management over the quarter, with all themes contributing except alternatives and its overlay/liquidity products, which were flat.
Investment returns were particularly strong in the blended debt, local currency, external debt and equities themes, Ashmore said.
Since the start of the year, the MSCI Emerging Market index has risen 6 percent, after a 5 percent fall in 2013.
Ashmore trades at 15.3 times its 12 months forward earnings estimate, nearly 10 percent above the five-year median figure, Thomson Reuters StarMine data showed.
Its shares have dropped 11.6 percent so far this year, underperforming a 0.5 percent decline in the FTSE 100 index. Of 18 analysts tracking the company, five rate it a "buy" or a "strong buy", a drop from seven three months ago, StarMine data showed. (Additional reporting by Nishant Kumar; editing by Matt Scuffham and Jane Merriman)