Research On The Management And Operation Problems Of Open-end Funds In China

Open-end funds has become the mainstream and developing tendency of investment funds because of its strong market choice character,good liquidity,high transparency and convenience for investment. The development of pen-end fund in China is still in starting stage. Further and more canonical development of open-end fund in China needs research on the problems which has been existing in management and operation nowadays,finding out some corresponding solutions.This paper takes the management and operation problems of open-end funds in China as research object. Using the successful operational experiences of America for reference,basing on the theory of investment,contract economics and information economics,and taking the method of combining theoretic analysis and practical investigation,this paper do a deep and systemic research on problems existing in open-end funds in China.This paper analyses the homogenous tendency of open-end fund at first,pointing out that unperfect development of market and investors'immature investment opinions is the origin of such phenomena. Secondly,having compared the fund sizes and purchase fee rates of 25 open-end funds in China,conclude that there are problems of diseconomy of scale and indistinctive relativity between fees and achievement in Chinese open-end funds. Then this paper introduces benefit and cost function to analyze the problem of lack of motivation and constrain mechanism towards fund managers because of unreasonable fees in China. Thirdly,this paper analyze funds managers'normal hazards by static game model,and then points out fund managers have serious tunneling behaviors in Chinese open-end fund industry. In the end,this paper analyzes the causes of liquidity risk of open-end fun and the particularity of liquidity risk of open-end fund in China,and concludes that liquidity risk in Chinese open-end fund industry is higher through calculating the rates of share change and comparing the portfolio selections of top 20 open-end funds in China.Based on the above researches,this paper makes some countermeasures and suggestions on how to resolve the existing problems in open-end fund industry in China.