Mutual funds registered for sale in Thailand posted an average gain of 4.11% in May, bringing the total return for the January to May period to 9.34%, according to data from Lipper.

"The mood in the markets continues to be of two camps. The bears claim valiantly that there is still a heightened degree of uncertainty in the global economy, with recovery in the form of W-, L-, or U-shaped curves, instead of the V-shaped recovery the market appears to be pricing in," says Ivan Ng, a Singapore-based research analyst for Asean at Lipper. "The optimists, meanwhile, believe we have already plumbed the depths of the market, but we are generally unwilling to commit to a view that this three-month rally in equities is sustainable from here."

Equity funds once again outperformed all other asset classes in May, as they did in April, with an average gain of 11.12% last month. All fund groups were in positive territory in May.

Emerging market portfolios were the top performing equity funds in Thailand last month. The three top-performing equity funds were PrimaVest-Allianz GI BRIC Stars (up 22.58%), TISCO China India Dividend (up 21.33%), and MFC Invest Asian Equity (up 20.34%).

Among bond funds, the top performing last month were SCI New Zealand Bond (up 9.43%), SCI New Zealand Bond 2 (up 9.06%), and SCI Australian Bond (up 8.08%).

Forty-nine new funds were launched last month, with only two equity funds on the list.

The new launches included oil and gold equity funds, with the remaining being bond or money market funds.

"The fund industry continued to launch funds that look to be based on popular investment themes, since the unprecedented monetary easing in the United States over the past few months stoked longer term fears of inflation," says Ng.