CI Financial Income Fund’s assets under management dropped 4.2% in January, to $64.3 billion as of January 31, according to a report released Friday.

It’s total fee-earning assets came in at $99.2 billion.

“In spite of the high levels of volatility in global markets in January, our core business remains solid,” said Stephen MacPhail, president of CI, in a release.

In January, CI saw gross sales of $1.03 billion and net redemptions of $490 million. The company said $165 million in net redemptions were the result of an institutional client reallocating investments from CI mutual funds to CI pooled funds, and it is expected the will be reinvested at CI in the coming months. Another $310 million in redemptions were related to series of deposit notes, which use asset allocation strategies in which money is moved out of the underlying funds when related markets are declining.

“Gross sales of over $1 billion represent an increase over previous months, and our newer initiatives in particular are selling well, including T-Class funds and the SunWise Elite Plus Segregated Funds,” said MacPhail. In addition, the Cambridge Funds, managed by Alan Radlo, have gathered $40 million in assets since their launch on January 7, he added.

CI’s assets under management at January 31, 2008 consisted of investment funds and pools of $61.0 billion at CI Investments Inc. and United Financial Corp., institutional assets of $2.9 billion at KBSH Capital Management Inc. and structured product assets of $514 million.

Assets under administration are $33.3 billion, as of January 31, according to the company’s reports. This consisted of $24.6 billion in assets under administration at Assante Wealth Management (Canada) Ltd., and $8.7 billion in assets under administration at Blackmont Capital Inc.

Overall, CI’s AUM fell 4.2% during the month. The S&P/TSX Composite Index fell 4.7% for January and the S&P 500 dropped 4.9%.