China mutual funds tumble in March as stocks dive

SHANGHAI, April 8 (Reuters) - China's open-ended equity-oriented funds registered a 12.4 percent to 17.2 percent loss in their net asset value per unit in March but still outperformed an 18.9 percent plunge in the benchmark CSI300 Index .CSI300. Even bond funds, many of which have exposure to the stock market, posted a negative return of 0.54 percent last month, a study by Lipper showed. China's domestic A-share market fell sharply in March, due largely to worries about domestic inflation, the health of the U.S. economy and a big increase in the supply of new shares.

The CSI300 Index, against which most Chinese mutual funds are benchmarked, had slid 32 percent from its record high hit in October, versus a 20-28 percent fall in the NAV per unit of stock-focused as well as balanced funds, said Lipper, a global fund intelligence firm owned by Reuters.

Foreign A-share funds, participants in China's Qualified Foreign Institutional Investor (QFII) scheme, dropped 16.4 percent on average in March and racked up an average loss of 29.4 percent over the last six months.

The combined assets of 19 QFII A-share funds monitored by Lipper shrunk to $5.95 billion last month from $6.66 billion in February due to redemptions and falls in NAV, it said.

An A-share fund run by ABN AMRO AAH.AS generated a negative return of 19.1 percent in March, making it the worst performer among the QFII funds tracked by Lipper.

The four major overseas investment funds launched by Chinese fund houses under the country's Qualified Domestic Institutional Investor (QDII) scheme saw an average fall of 9.6 percent in their NAV per unit last month, the report said. (Reporting by Charlie Zhu; Editing by Anne Marie Roantree)