A total of 396 funds mutual funds have been eliminated so far this year, according to Morningstar Inc., Chicago.

In all of last year, a total of 438 funds were folded, Morningstar says. On the other hand, just 156 new funds have been launched this year, compared with 487 for all of 2008.

Those figures strongly suggest that the industry will see the first net drop in total funds since 2002, notes Morningstar. The numbers are for open-end mutual funds, excluding exchange-traded funds, which have continued to grow in the face of the recession, Morningstar observes.