Most of the mainland's equity-based funds posted losses in the fourth quarter last year amid market volatility as they failed to cash in on a 20 per cent rally between early November and mid-December.
According to Shanghai-based financial data provider Wind Information, 128 equity-based funds that published fourth-quarter reports lost a combined 50.28 billion yuan (HK$57.1 billion) in the last three months of 2008, with only 18 of them making money.
The woeful performance was in stark contrast to brokerages' proprietary trades, which made most of the year-end rally to cash out, analysts said.
The Shanghai Composite Index lost 20.6 per cent in the three months to December as poor company earnings weighed on investors.
However, the gauge staged a 20 per cent rally between early November and mid-December buoyed by Beijing's 4 trillion yuan stimulus package and other economic incentives.
It then dropped 9 per cent to close at 1,820.81 points on December 31 as some skittish investors were eager to exit on expectations of worse economic conditions in the first half of this year.
'Equity-based funds were still aggressive in the roller-coaster ride,' said Dazhong Insurance fund manager Wu Kan. 'The loss was not a surprise based on the market movement.'