An Empirical Study On Chinese Open - End Securities Investment Funds Performance Evaluation

Mutual fund is a kind of cooperative investment financial instrument characterized by shared risk and common benefits. Domestic mutual funds appeared and developed lately. It is only 7 years. The issue of The Temporary Rules for Mutual funds in November 1997 was a milestone for mutual funds' development. During the 7 years from 1998 to 2005, its development in our country was very fast. The appearance of open-end mutual funds, in Sep 2001, diversified financial instruments. Open-end mutual funds caught up with and surpassed close-end mutual funds, and caught investors' eyes. To most investors, how to choose mutual funds with the highest return correctly and scientifically, when facing so many kinds of mutual funds, is the most highlight problem. But we have to notice that using single indices in mutual funds' performance evaluation is a common thing. It has some bit of bias. Author of this article researches deeply mutual funds' performance evaluation methods dominated in western capital market and wishes using them to evaluate the performance of domestic mutual funds. Based on these theories, author advocates a method to forecast the performance. It is also the innovative point. Author does some single indices for the 14 sample mutual funds concerning the performance of mutual funds, such as Sharpe, Jensen, Treynor indices, then does a comprehensive analysis for these single indices. At last a forecasting evaluation is done. Conclusions are reached according to the empirical analysis. They are as follows: 1, In recent two years, the performance of sample mutual funds is generally better than that of the whole market.2, Facing the difficulties in performance evaluation, our market requires enhancing the strength of governing. 3, It is recommended that the government should lessen supports to mutual funds. And this would be good to its development.