Mutual Fund Openings Tail Off

U.S. mutual funds are being created at the slowest rate since 1991--a sign that the industry may be reaching a saturation point.

An estimated 63 funds have opened this year, down from 349 in the first three months of 1998 and down from a record 420 funds in the first quarter of 1997, according to CDA/Wiesenberger, an industry research group in Rockville, Md.

The first quarter tends to be the busiest for fund introductions, so if the first three months are any indication, 1999 could see the lowest number of fund openings in eight years.

“The numbers aren’t complete yet, but it looks as though the pace of fund introductions could be slowing,” said Stephanie Kendall, an analyst at Wiesenberger, a unit of Boston-based Thomson Financial. “More and more companies may be looking to rein in their list of funds as opposed to offering new ones.”

The number of mutual funds has more than doubled since 1993 to 11,758, as assets of the industry have ballooned to $5.5 trillion today from almost $2.1 trillion over the last five years, according to CDA/Wiesenberger.