Oct 31 (Reuters) - Asset manager T. Rowe Price's ( TROW )

third-quarter profit rose on Friday, as soaring markets

boosted its assets under management and the corresponding fees,

cushioning a hit from outflows.

Shares of the company rose 2.2% in premarket trading.

Major indices and asset classes extended their rallies

through the quarter, hitting consecutive record highs as AI

vigor and falling interest rates gave investors confidence who

had been worried about macroeconomic cracks and tariffs.

This helped assets under management, which are largely tied

to the performance of underlying investments and client money

flow.

T. Rowe's AUM jumped 8.4% in the quarter ended September 30

despite net client outflows of $7.9 billion.

"We reached an end-of-period high with $1.77 trillion in AUM

as of September 30 and created an opportunity to bring

innovative new solutions to market for our clients with our

recently announced strategic collaboration with Goldman Sachs ( GS ),"

CEO Rob Sharps said in a statement.

In September, T. Rowe and Goldman struck a deal under

which the U.S. dealmaker will invest up to $1 billion in the

company, marking the beginning of a partnership to package

alternative assets into T. Rowe's retirement money.

T. Rowe's active buying and selling strategies have lost

favor over the years, following the popularity of low-cost

passive fund managers that aim to track an underlying asset or

index.

The company has been diversifying its offerings to win back

customers.

Last week, it filed to launch an actively managed

exchange-traded fund tied to multiple digital currencies,

foraying into the cryptocurrency space.

Investment advisory fees, typically a percentage of the AUM,

rose 4.4% to $1.7 billion in the third quarter from a year ago.

It earned a profit of $646.1 million, or $2.87 per share,

compared with $603 million, or $2.64 per share, a year ago.

(Reporting by Ateev Bhandari in Bengaluru; Editing by Shinjini

Ganguli)