Mutual fund managers increased their exposure to securities in the second quarter of this year despite severe market volatility, according to earnings reports.
Average stock exposure among 128 equity funds edged up 0.93 percentage point to 87.2 percent from April to June compared to the previous quarter, according to half-year earnings reports released yesterday by 16 mutual fund firms.
The reports covered 259 mutual funds.
For balanced funds, the average investment in securities increased 1.1 percentage point to 75.9 percent in the second quarter from the first three months.
The Shanghai Composite Index shed 5.67 percent in the second quarter.
The funds posted a combined loss of nearly 21.67 billion yuan (US$3.35 billion) in the second quarter. Equity funds lost almost 15 billion yuan, the most among all types of funds. Balanced funds lost 6.96 billion yuan, bond funds lost 310 million yuan and Qualified Domestic Institutional Investor funds lost 55 million yuan, TX Investment Co said yesterday.
TX Investment said money market funds were the only fund type to earn a profit in the past three months.
According to the earnings reports, 23 money market funds posted a total profit of 326 million yuan.
Meanwhile, fund managers sold off more shares in machinery producers compared to any other sector. The sectors with the biggest increase in holdings were beverage companies, developers and electricity producers
Most fund managers ruled out the possibility of a hard landing as they expect demand in third and fourth tier-cities, as well as in western China to sustain the economy.
