Relationship Of FOF Fund Expense Ratio And Performance

Recently, domestic FOF fund market has developed rapidly. Especially, the stock-market swing throughout 2015. In such a volatile market environment, the steady of the FOF fund products increasingly become the focus of investor attention. However, the development of FOF fund is still in the preliminary stage, and the research results of the FOF fund are less. The Literature about performance, cost and other aspects are limited, therefore, the impact of the double charge of FOF fund and the performance of the FOF fund remains to be further research. So the correlation research between FOF fund performance and the expense ratio has an important practical significance for guiding investment funds.Through the research on the relationship of the brokerage FOF fund expense ratio and performance, we expect to provide some guidance recommendations for investors and fund companies. The main part of this paper has four chapters in totalThe first chapter, this chapter mainly introduces the preparatory work, including the research background,, the theoretical value and realistic meaning of the paper, the research methods and content, the innovation points and shortcomings of the paper.The second chapter, FOF fund’s current situation and literature review, this chapter introduces FOF fund overview, and then it introduces FOF fund’s development situation at home and abroad, then this paper relevant literature fund were reviewed.The third chapter, model setup and index selection. First, this chapter introduces theoretical model and model specific principles set; Secondly, according to relevant literature of domestic and foreign, the paper select variables, and FOF fund expense ratio as explained variable, FOF fund performance as explaining variable, FOF scale, FOF age and the proportion of cash holdings as the control variables, at the same time, the article charges FOF fund composed of detailed analysis and description; At last, the paper introduces sample selection and data sources, and sample descriptive statistics.The fourth chapter, empirical analysis, first, the article use the Hausman test to determine the form of panel data model, using the F test to determine the specific form of panel data model, and ultimately determine the use of fixed effect variable intercept model. Then, thesis data empirical analysis obtains negative correlation of the FOF performance and expense ratio. Finally, according to management fees charged way, we will sample data into three categories. We establish the panel data model to estimate the coefficient between FOF fund expense ratio and performance. The way of charging FOF fund has a significant impact on the fund performance.Finally the following conclusions:(1) Relationship between FOF fund expense ratios and performance is negatively.(2) The way of FOF Fund management fees has an impact on FOF fund performance. For the FOF fund of charging management fees and performance fees, relationship between FOF fund expense ratios and performance is negatively; For the FOF fund of charging only management fees, relationship between FOF fund expense ratios and performance is not significant.