Most markets have since recovered, but investment continues to flee China and related regions, which in 2006 captured half the US$24 billion invested in emerging market equity funds, said Brad Durham, co-founder Emerging Portfolio Fund Research.

"The flows have definitely fallen off from the China funds in recent weeks and recent months, precipitated by the sell-off in February and March," Durham said in an interview this week.

The week ending Feb. 7 marked the first weekly period in a long time that money flowed out of China funds and funds called Greater China, which includes money invested in Hong Kong, Taiwan and Chinese mainland, Durham said.

From Feb. 7 through April 18, the latest week data is available, about US$1.63 billion left China funds and US$934 million left Greater China funds, he said.

The shift in sentiment is remarkable because China was a hot story in 2006, with China region funds returning almost 27 percent, better than any other asset class or investment objective, according to Lipper, a unit of Reuters Group Plc.

China region funds are up 6.89 percent this year as of April 19, Lipper said. But many other investment objectives have done better, led by utilities, which are up 11.49 percent and followed by Latin American funds, up 11.37 percent.

The BRIC markets of Brazil, Russia, India and China -- another popular investment theme last year -- all have seen outflows from equity funds dedicated to those countries in recent weeks and months, Durham said.

Where the money has gone is unclear, but Malaysia and Singapore have seen large inflows in recent months, he said. Almost US$2.4 billion has flowed into Malaysian funds in the past five months, and US$1.53 billion into Singapore funds during the past six months, he said.

"Those are two markets where we've seen a very sharp inflow pattern in recent months," he said.