Canadian mutual fund companies face tough competition from other avenues as the hype of the 1990s bull market wears down, the Financial Post reports. With greater affinity toward high-yielding instruments such as income trusts and structured products, Canadian investors are likely to pull the plug on mutual funds.

"There is some concern in the market that the combination of the significant sales boom occurring in the late 1990s and 2000 and the recent relative slowdown in mutual fund sales may spell disaster for the mutual fund managers," said John Aiken, an analyst at National Bank Financial, in a research note on Monday.

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