For China's fund management companies, memories of last year were full of cheer.

According to a report by Tianxiang Investment Consulting Co. Ltd. based in Beijing, 594 funds operated by the country's 60 fund management companies raked in more than 910 billion yuan ($133 billion) in profits in 2009, receiving a boost from the vibrant stock market.

The benchmark Shanghai Composite Index increased nearly 80 percent in 2009 despite some corrections in the latter half of the year. But investor sentiment turned sour on worries that liquidity could dry up as regulators reopened the door for initial public offerings. 

The best performers were stock-focused funds that reported a combined profit of around 520 billion yuan ($76 billion). The QDIIs (qualified domestic institutional investors) also jumped back into the black last year after a two-year loss-making streak.

In spite of their disagreements on where the stock market is heading, fund managers are clear on one thing: It won't be a smooth ride.

Market prospects look questionable as investors grow jittery about inflation that may prompt policymakers to halt easy monetary policies, said Wang Yawei, Deputy General Manager of China AMC Fund Management Co. Ltd.

There are likely to be tentative swings as investors look for a direction of the government policies, he added.

Yu Jun, Executive General Manager of Citic Securities Co. Ltd., agreed. "Adding to the uncertainty are inflows of speculative hot money looking to cash in on a stronger yuan," he said.