Mutual funds post annual losses

Mutual fund investors have lost, in real terms, almost 3% of the invested sums in the past year. The units of open investment funds that are included in the National Union of Collective Placement Bodies (UNOPC) posted an 11.9% average increase over the last 12 months, against an inflation rate that came to 14.8% during the same period. Moreover, there are no signs of improvement. Last month, the value of fund units climbed, according to UNOPC, by 0.7%, while the inflation rate reached 1.2%. In the case of a developed capital market, the explanation is to be found most of the times in the evolution of stock exchange quotations. In Romania, however, the stock exchange was on the rise. All three official indicators of the Romanian stock exchange registered increases ranging between 40% and 50% during the same period. What will happen to mutual funds when stocks go down, which, according to analysts, is bound to happen sooner or later? The comparison between performances of mutual funds and those of a banking deposit is even gloomier. Such a deposit carrying a fixed interest, opened up a year ago, would have brought gains of 22-25%. ZF