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China stock market
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Enduring pain: 90% of China’s equity funds suffer as market loses US$1 trillion of value

  • Only 70 of the 941 equity funds in China have delivered positive returns this year, according to financial data provider 51iFind
  • The CSI 300 Index is headed for a third straight year of decline, with year-to-date loss of nearly 14 per cent

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The gloom in China’s economy has infected the stock market, with the CSI 300 Index tumbling 12 per cent so far this year. Photo: Shutterstock
Jiaxing Li

Most money managers in China lost money in 2023, with nearly 90 per cent of actively managed funds under water, as the nation’s US$9.5 trillion stock market closes out the year with the worst losing streak in its 32-year history.

Only 107 of the 941 these equity funds in the onshore market, or less than 11 per cent, have delivered positive returns, according to financial data provider 51iFind. The rest tumbled, with the worst performers losing nearly half their capital.

The dismal performance reflects the malaise in China’s economy, which has been marked by shrinking manufacturing, declines in consumer and producer prices, and a troubling property-market crisis. At the same time, Beijing has dashed hopes for a stimulus bazooka, forcing some analysts to abandon their bullish targets after a near US$1 trillion rout.

The gloom has infected the stock market, with the CSI 300 Index tumbling 14 per cent so far this year. After a 22 per cent slump in 2022 and a 5.2 per cent drop in 2021, the market is set for its longest annual run of losses since its inception in 2002. In Hong Kong, the Hang Seng Index is heading for a fourth year of slump, the worst since its inception in 1969.

“The macro complexities at home and abroad continue to test investors’ nerves,” Chang Zhen, a portfolio manager at Harvest Fund Management, said in a third-quarter report to clients, citing heightened US-China tensions, the Israel-Gaza war and weak domestic economic recovery. “There is strong risk-averse sentiment and the market is trying to regain its confidence.”

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