Analysis On The Closed-end Funds Discounts In China On The Basis Of Periods

Closed-end funds discounts,which means the closed-end funds are always traded with prices lower than their net asset value,is a general phenomenon in the world,and still be a puzzle in the financial fields.The foreign economists have proposed several hypotheses in existing studies,but for the complexity of the markets and the particularity of different countries,there'S still no such a common explanation to this puzzle.The closed-end funds discounts are much more obvious and deeper in our country,investigating the problem under our stock market has its necessity and importancy.We start the paper with a review of the previous studies and an introduction of the history of the closed-end funds in our country.By the statistics of the history discounts data,we generalize the characteristics of the closed-end funds discounts phenomenon in China,and prove that the discounts in our country are much more deeper than in others'.We try to discuss the explanations of this phenomenon from two aspects:the investor'S rational expectations and the noise trade.Considered that noise is hard to measure,we investigate the investor sentiment'S influence on discounts mainly through the three aspects followed,the relationship of various closed-end funds discounts and their changes,the time that new funds choose to get started,and the relationship of discounts changes with the returns on stocks of smaller capitalization.Meanwhile,we get several suggestions about promoting the development of our country'S closed-end fund,making trade price of fund get rational level and standardzing the management of the fund company.In the research of this paper,we get several main conclusions as follow:(1)The insurance companies hold a majority of the funds,which results to the lack of liquidity of the funds,it is the main cause of the discounts in our country(2)The investors sentiment hypothesis,which is generally accepted in the western countries,can be very good explaining the discount of the closed-end fund of our country.