Oct. 27, 2004 — Shareholders still have a favorable opinion of the mutual fund industry, although the recent trading scandal and the bear market have cooled investor sentiment, a survey by a trade group found.

The survey by the Investment Company Institute found that 72% of fund shareholders had “very” or “somewhat” favorable impressions of fund companies this year, compared with 71% in 2003.

Eighty-four percent had a favorable impression in 2000. That was the highest level since 1997, when the ICI began conducting the survey.

Last year’s trading scandal did hurt the industry’s reputation, the ICI said. More than three-quarters of fund shareholders are aware of the scandal, and among those investors 56% indicated news of the scandal caused them to have a lower opinion of the industry than previously, according to the survey. Forty-four percent said it had no effect on their views.

The survey found that the leading factors that shape shareholders’ opinions of the industry are, fund performance (70%), personal experience with fund companies (57%), current events in financial markets (49%), and professional financial advice (47%), the organization said.

Contact Bob Keane with questions or comments at bkeane@investmentadvisor.com.