Stocks-linked funds produce negative yield

Among the funds, those that are linked to high-tech stocks fell by 11.06 percent, analysts said.

According to Wu Wen-tung, analyst with Capital Investment Trust Corp., stocks rose in the early part of August, on optimism demand will increase in China, Taiwan's largest export destination.

However, by the end of August, investor confidence began to shatter, due to a slew of disappointing data from the United States.

At the same time, several Taiwan firms also reported less-than-satisfactory second quarter and first half results. The weighted index TAIEX then began to tumble, erasing gains from the earlier part of the month, Wu said.

For August, the TAIEX shed 144.35 points or 1.86 percent, widening total loss from the beginning of the year to almost 7 percent. The weighted index closed at 7,720.82, up 52.57 points, yesterday.

Wu pointed out Taiwan stocks will continue to go through a correction, given poor performances of high-tech shares and investors' cautious attitude.

He said stocks may give more satisfactory performances in the fourth quarter, given stronger demand in China and prospects companies will begin to stock up on goods.

For now, Wu said people should pick funds that are linked to companies with solid fundamentals and showing steady growth.

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