(Bloomberg) -- The slump in China’s equities markets has wrong-footed some of the biggest names in the country’s mutual fund industry, with 99% of professionally managed products on track to lose money this year.

Fewer than 1% of China’s equity-themed, open-ended mutual funds have posted positive returns, according to data from financial website East Money Information Co., which screened 2,296 products. Funds recording drawbacks of more than 30% this year include flagship products from E Fund Management Co.’s Zhang Kun, Lombarda China Fund Management’s Ge Lan and Invesco Great Wall Fund Management Co.’s Liu Yanchun.

The data show that choosing the right sector has been more important than a manager’s stock-picking prowess. Of the 19 mutual-fund products still in the green at the end of October, seven invest in coal or energy and two are quant funds. The remainder lean toward investments in state-owned companies and health care, with some only retaining gains because they were established after earlier market declines.

Topping the list is the Yingda SOE Reform Theme Equity Fund, up 22% this year, which counted traditional Chinese Medicine firm Dong-E-E-Jiao Co, Shanghai Jahwa United Co. and liquor maker Kweichow Moutai Co. among its largest positions as of the end of June.

The benchmark CSI 300 Index has slumped 29% in 2022, with fewer than 10% of its members in the green. After a similar sell off in 2018, 30 of China’s mutual-fund products ended the year with gains, though none rewarded investors with more than a 4% return.

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Author: Bloomberg News