Defaults in Chinese mutual funds reached their highest level in five years

The failure of domestic mutual funds in China has reached its highest level in five years as China's stock market continues to weaken.
Bloomberg News reported on January 19 that China's asset management sector was hit hard by the sharp decline in stocks, and domestic mutual funds experienced a similar wave of closures.
A total of 240 domestic mutual funds were closed in 2023, the highest figure in five years. This trend has continued, and since the beginning of the new year, 14 mutual funds have already been closed, and another 24 will be closed soon.
Fund-raising from domestic mutual funds in China also continued to decline, reaching the lowest level in a decade, according to reports. Investors have lost confidence in the market slowdown. In addition, the collapse of the stock market in China exacerbated the crisis. As a result, retailers abandoned mutual funds and began to hold cash.