An Empirical Analysis Of China Mutual Fund Shareholding Allocation Influences Fund Performance

The scale of global open-end fund asset management has increased dramatically in these years.Furthermore,the growth rate has doubled in the past decade.It is clear that mutual fund has become one of the main tools for international investors to manage financial resources.Supported by China government and the gradually improved capital market,there was a great diversity of financial product in the market.Moreover,the investment targets are no longer limited in domestic area.These all make the mutual fund market grow by leaps.Equity funds have the characteristics of high-risk and highreturn which could cause huge loss for investors.Therefore,it is more necessary to analyze the factors that may affect the performance of the fund and that has a certain reference value to fund managers and investors.In this research,it focused on two perspectives,fund shareholding concentration and fund industry concentration,to see the influence of fund performances.China stock fund performance from January 2015 to September 2018,based on the absolute return and risk-adjusted return,as the sample,and built the panel data model for empirical analysis.This research discovered the relationship between the above variables and fund performance.In order to have a much more comprehensive research of the impact on fund shareholding allocation and performance,this research also considered the investment style and investment industry as the dummy variables.There are following five results.First,shareholding concentration has a positive correlation with the performance of fund.The significant test showed that the increasing shareholding concentration would help improve the performance of fund.Also,industry concentration has a positive correlation with fund performance even though it's not significant.Second,investing in large-cap stocks has a significant positive impact on fund performance which means that investing in large-cap stock has more profit than small-cap stocks.Investing in growth stocks has little or no significant impact on fund performance.Third,investing in stocks with both large-cap and growing characteristics has a significant positive correlation with fund performance in the model of average rate of return and Jensen index,which indicates that large-cap stocks with promising outlook would have a positive impact on fund performance.Fourth,investing a largecap stock in one single industry under certain constraints has a positive impact on fund performance.Fifth,the impact of stocks investing in a single industry with the growing characteristics in the fund evaluation indicators is positive,but that does not pass the significant test.In the end of the research,it suggested for both investors and fund management institutions.However,it also mentioned the limitation of this research.Meanwhile,it's expected that the development of China fund market will improve by degrees and the investors who are interested in fund research will establish investment strategies that match their own risks.