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.' The funds increased their positions in the fourth quarter, with 67.71 per cent of their assets being invested in A shares, up 1.5 percentage points from the end of September, the reports showed. Wind said 22 bond funds posted profits in the fourth quarter, earning a total of 2.42 billion yuan. The 16 money-market funds made a combined profit of 855 million yuan. There are nearly 400 mutual funds on the mainland, and the remaining funds have yet to publish their quarterly reports. Mainland mutual funds lost 40.8 per cent of their value, or 1.33 trillion yuan, for the whole year, preliminary figures from fund consultancy Z-Ben Advisors showed. The Shanghai index tumbled 65.4 per cent last year, the biggest drop in its 18-year history. This has prompted investors to turn to money-market and bond funds for stable returns. The mainland's mutual fund industry saw its assets grow fourfold in 2007 amid a 97 per cent market rally. They raked in management fees of 28.2 billion yuan in the same period, up 395 per cent from a year earlier.