Karachi: The local mutual funds showed a decent growth of 15 percent in the first half of financial year (1HFY12) in terms of value, reaching its monetary volume Rs 287 billion by December 2011.
The open-end funds rose by 19 percent in 1HFY12 with value of Rs 267 billion or $3.05 billion while closed-end funds showed a significant decline of 21 percent to settle at Rs 20 billion $.23 billion.
The size of the fixed income funds’ category increased by a massive 41 percent HoH during 1HFY12 (Jul-Dec11) to reach at Rs 55 billion with meager depreciation of less than 1 percent on MoM basis. However, on a cumulative basis, the size of the category appreciated by a healthy 30 percent YoY in 2011, primarily owing to additions of four new income funds in 2011.
In December 2011, local mutual funds saw redemption of 5 percent on month-on-month with major MoM decline of 12 percent witnessed in the money market funds’ category, which clocked in at Rs105 billion.
The month’s closing seems to be the main reason behind the industry-wide decline, as the banks and other financial institutions usually pull out funds from their investments especially from their short-term fixed income instruments to keep their balance sheets in decent shape, analyst Mazhar A Sabir of InvestCap Research said.
After having witnessed a tremendous growth in size during the last 11 months of 2011, the money market funds category showed a decline of 12 percent MoM to reach at Rs105 billion in December 2011. Major decline witnessed in the size of ABL Cash Fund, which declined by 45 percent MoM.
However in 2011, the money market funds increased by more than 100% with a handsome growth of 36% HoH in funds size during 1HFY12 (July-Dec11).
The equity related funds continued their declining trend in line with the negative spell that continued at the local bourses of the country. In quarter-to-quarter comparison, in fourth of 2011, the mutual funds rose by 16 percent with a solid total increase of 29 percent YoY in 2011, he added.
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