Mutual fund industry appreciates by 1.5pc

KARACHI: The local mutual funds industry appreciated by only 1.5 percent during the quarter ended on September 30, primarily due to the money market category performance, whereas other funds categories consistently showed a declining trend, according to the data compiled by InvestCap on Wednesday.

As on September 30, the local mutual funds industry stood at Rs202 billion, declining by 2.4 percent against the industry size as on June 30.


Industry’s open-end funds size decreased by 1.8 percent to close at Rs174 billion and the closed-end funds size reached Rs28 billion, showing a decline of 6.3 percent, it showed.

Equity funds category showed an appreciation of eight percent amid KSE-100 Index witnessing an upward movement of two percent in September.

If we compare the industry fund size with that at the end of June 2009, it stood at Rs204 billion, while in December 2009, the fund size reached Rs225 billion, showing an appreciation of 10.3 percent, according to the data.

The industry has been on a downturn, declining by 11.2 percent till June, reaching Rs199 billion. The money market category earned an average annualised return of 11 percent during the quarter, it showed.

The reason for the improved level of returns was the fund manager’s policy of keeping funds under the short-term placements, which would benefit in the current interest rate environment where secondary market yields have gradually been on the rise again by now, said Mazhar Sabir, an analyst at Invest Capital.