China's mutual funds post huge book losses

14:34, August 30, 2010      
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China's securities-based mutual funds reported book losses totaling 439.75 billion yuan (64.64 billion U.S. dollars) in the first half, TX Investment Consulting Co. Ltd., said Monday in a report.
The losses were the second biggest for China's mutual funds industry in history after the industry's record losses of 1.08 trillion yuan in the same period of 2008.
The report said that of the 661 mutual funds managed by 60 fund companies in China, 261 equities-oriented funds reported combined losses of 296.3 billion yuan.
The TX report said 155 funds that had invested part of their capital in stocks lost 120.5 billion yuan.
China's benchmark Shanghai Composite Index fell 26.82 percent in the first half, sending the prices of most equity funds below their 1-yuan face value per share.
The Hushen 300 Index, which tracks the performance of major companies with 60 percent of the market value in China's Shanghai and Shenzhen stock exchanges, plunged 28.31 percent in the first half.
Principal guaranteed funds and qualified domestic institutional investor (QDII) funds, which are considered less risky than stocks-oriented funds, all lost in the first half.
In the January-June period, only money and bond funds gained ground.
Money funds posted profits of 1.01 billion yuan while bond funds reported returns of 1.24 billion yuan in the first half, said the TX report.
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