Neil Woodford's flagship fund has halved in size over the past 17 months after a long period of underperformance.
Last summer Woodford Equity Income had £10.7bn in assets but a combination of underperformance and outflows has seen this fall to £5.1bn now.
Over the past year the fund has lost 13.5 per cent while its sector, the IA UK All Companies, lost 5.1 per cent, which put the fund in the bottom quartile for performance.
Mr Woodford has recently spoken about how the volatility seen in markets over recent months, and the problems facing emerging markets, had proved his view of the world economy right.
And Woodford Equity Income's performance has improved compared to its benchmark more recently, losing 6 per cent over the past three months while its sector lost 9.3 per cent.
Mr Woodford said: "Operationally, the companies in my portfolios continue to perform positively. The market has remained reluctant to reward this operational progress with higher share prices, particularly for domestically-focused businesses.
"I remain very confident that the funds are well-positioned to deliver attractive long-term returns, despite the more challenging global economic environment that I foresee."
Laith Khalaf, senior analyst at Hargreaves Lansdown, said: "Improved performance is welcome after what has been a disappointing period for Neil Woodford. But as far as we are concerned we keep an eye on the long-term. We are not looking in terms of what the fund is going to do in the next three or four months.
"We are looking at whether he can add value over five or 10 years and our analysis suggests he has got a very good track record of doing it in the past, which leads us to back him in the future.
"Neil Woodford's approach is contrarian, which means there will be periods when he underperforms."
Mr Woodford has been much more positive on the outlook for the UK economy than his peers, which has hit the performance of his Woodford Equity Income fund.
But earlier this month he said the strong US dollar meant emerging market economies were experiencing severe "stress" and this was feeding into asset prices, which he expected to continue.
He said most of the companies held in his portfolios had performed positively, but this was not being recognised by the market.