Across The Border | Bond funds provide scant relief for mainland investors who fled 2015 stock rout
About a third of mainland bond funds managed by fund houses have posted losses so far this year, according to Wind Information
Mainland investors who sought safety in bond funds after they were burned in the stock market crash of mid-2015 may find themselves licking their wounds once more.
As of Monday 450 bond funds – about a third of the 1,400 mutual funds focusing on fixed-interest investment – had posted losses this year, according to Shanghai-based data provider Wind Information.
The woeful performance of the funds – known normally as an investment product that generates low but stable returns – came after a frenzied buying spree last year.
The total value of bond funds under the management of the 113 mainland mutual fund houses climbed 760 billion yuan (US$110.4 billion) to 9.1 trillion yuan in 2016.
I tried to dodge volatility on the stock market, only to find volatility spread to the bond market
Their sudden popularity reflected a weaker risk appetite among investors after the key stock index slumped 43.3 per cent in less than three months from June 12, 2015 – a market rout that wiped out capitalisation of US$5 trillion.
