1. China’s mutual fund industry reached a historic milestone at the end of April, with total net assets surpassing 39 trillion yuan ($5.7 trillion) for the first time. According to the Asset Management Association of China, the month-over-month increase was 4.9%, bringing the total to 39.36 trillion yuan. This growth was driven by a rebound in domestic equities, which lifted fund valuations after a volatile first quarter. [para. 1][para. 2]2. Hybrid funds led the gains among fund categories, rising 10.4% to 4.16 trillion yuan in April. Equity funds also grew, increasing 3.2% to 5.28 trillion yuan, marking their first monthly expansion of the year. This uptick contrasts with the broader trend for equity funds, which were the only major category to contract in the first four months of 2025, with net assets declining 12.8%. Securities firms attributed this decline primarily to shrinking broad-market exchange-traded funds (ETFs). [para. 3][para. 4]3. Morningstar provided additional context for the first-quarter weakness in equity funds, noting that regulatory warnings issued in January about overheating in China’s stock market contributed to large ETF redemptions. State-owned Central Huijin Investment Ltd. also redeemed significant ETF holdings, leading to record net outflows from the domestic ETF market during the first quarter. These factors weighed on the performance of equity-focused funds despite the recovery seen in April. [para. 5]AI generated, for reference only