1t yuan paper loss for funds

[makapaaa]

<TABLE cellSpacing=0 cellPadding=0 width=452 border=0><TBODY><TR vAlign=top><TD></TD></TR><TR><TD vAlign=top width=452 colSpan=2>Published August 30, 2008

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(SHANGHAI) China's mutual fund sector incurred a record 1.08 trillion yuan (S$223.2 billion) in paper losses in the first half of this year due to the stock market's tumble but management fees more than doubled from a year earlier, the official Shanghai Securities News reported yesterday.

Equities-oriented funds, which put at least 60 per cent of their assets into shares, posted a combined unrealised loss of 1.06 trillion yuan.
Qualified Domestic Institutional Investor (QDII) funds, which invest abroad, had a combined unrealised loss of 24.7 billion yuan, due to weak overseas markets.
Money market funds were the only gainers, with a paper profit of 1.30 billion yuan. The data was based on first-half results published by 364 funds managed by 59 fund companies, the newspaper said.
China's benchmark Shanghai Composite Index lost nearly half its value during the first half of the year, weighed down by worries over an economic slowdown and fresh supplies of shares.
The tumble followed a two-year bull run that boosted share prices six-fold while the mutual fund sector grew almost seven-fold to more than three trillion yuan.
Despite the hefty paper losses, or losses on securities that are still held by fund managers, combined realised losses in the fund sector were a more modest 101.4 billion yuan.
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</TD></TR></TBODY></TABLE>Fund managers collected 18.8 billion yuan in management fees during the first half, up 120 per cent from a year earlier. The top 10 earners accounted for half of the sector's total fee income, led by China Asset Management Co, which collected 1.53 billion yuan. -- Reuters

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