Research Of The Irregular Convert System In Abnormal Loss Mechanism Of Graded B

Grading fund rapidly spread in 2015 for itsmobility, low threshold, leverage, low transaction costs and can be shorted in the domestic secondary market. However, during 2015, a substantial adjustment, B share investors suffered heavy losses.After the study, I believe that with its own lever B shares, investment losses is difficult to avoid, but due to abnormal losses caused by the irrational system, can optimize the system by fund managers to avoid losses.Grading fund is new, there are few domestic research data, and the article chooses to use 141 graded B funds as representative. This article analyzed how securities B decreased from 16 Yuan to 1 Yuan in less than three months in detail. Analysis of the characteristics of market transactions during the downward discount, securities B show a loss process views. Rated fund market transactions, product characteristics and the system is unreasonable, put forward was the need for grading Fund Research.During the study of securities B losses, I found that the net value of the parent fund rose 81.93 percent since its inception, but the B share price was down-24.55%. Net difference between the two is the abnormal loss. Closer, I count the domestic market share of B 2015 loss, abnormal loss situation; occasional conversion statistics, analysis of variable conversion features, and analysis did not fold under the classification of the fund characteristics. It found that the prevalence of abnormal losses, but also highly correlated with the occasional translation.There is a system problems. It is urgent toresearch defects of graded fund system, and design better graded fund productsthat suits Ashare market better and that can protect the interests of investors.This articleestablish a model to explain the operation mechanism of B share from the pricing, leverage and the bearish options of A sharethese three factors. The application of securities B illustrate that these three factors can explain the reasons of the loss of securities B. But the three factorsare just ostensible reasons of the loss, the real reason of it is the irregular conversion system.This article is aimed to confirm that the irregular conversion system is the real reason of the loss. In this paper, we first look for six graded funds, using the method of the only variable in the control group to prove that the difference between the upward and downward discount will result in a huge difference in the benefit of share of B, cause abnormal loss.Then we use examples of evidence to prove the most important conclusion of this paper, the root cause of the abnormal loss of share B is the irregular conversion system. Its influence mechanism works as these two results, upward discount reduce the safety and make it near the downward discount, the downward discountsystem makes the rising leverage and down leverage asymmetric. This paper proposes that investors should not hold B share for a long time, this is the second conclusion of the article.According to the present conversion system, I think that the principle of the new conversion system is to keep the safety pad, reduce the number of conversion times, and avoid the extreme downward discount rate. The new system includes three specific methods, such as raising the downward discount threshold value, using dynamic upward discount threshold value and increasing the net value of the upward discount. Through four times experiments of three groups we can find that the new system is feasible. At last, the article puts forward some proposals of this new system, which is based on the research process and the experiment result.