China Securities Investment Fund Of Economic Analysis

The development of security investment funds can be traced back to the 1990s while normative security investment funds in China has only a history of about three years. Although Chinese security investment funds have made great progress, there're still many problems in the daily life that need answers from theoretical fields.The problems of Chinese security investment funds we are facing are numerous and complicated. This paper looks into the past, the present and the future of Chinese security funds. It not only answers the problem what Chinese security investment funds are like, but also treats the more meaningful problem with great effort why the funds are like that. The paper's framework follows three rules. Firstly, it studies Chinese security investment funds from a new angle. Secondly, it probes further into the problems studied by some researchers but weren't explained clearly before. Thirdly, it discusses problems newly occurring and problems needing to be resolved urgently during the continuous development of Chinese security funds.Because of the existence of path dependence, we could hardly really understand Chinese security investment funds without the knowledge of the history of Chinese investment funds' development. The essence of security investment funds is a kind of financial institutional arrangement. Therefore, in the first chapter, by using the analytical method of the new institutional economics (NIE), the author gives a dynamical analysis on the development history of Chinese investment funds, discusses the endogenous mechanism of Chinese investment funds and explains why investment funds came into being in China with the theory of institutional supply and demand. The author divides the development of Chinese investment funds into three stages, and, by using the theory of institutional change, analyzes the progress of the dynamic evolvements and institutional change of Chinese investment funds, which ends with some illuminating results.Asymmetric information is one of the knotty problems we have to be faced with in the course of the development of financial markets. The security investment fund is not an exception. Considered from a deeper point of view, the security investment fund is a kind of financial institutional arrangement of principal-agent relationship. So, in the second chapter, the author studies Chinese security investment funds on the base of the principal-agent theory in information economics. By analyzing the problems of principal-agent risks and insider control, the author gives suggestions on countermeasures against the principal-agent risks of Chinese security investment funds. The third chapter is mainly about assessment of security investment funds and the relationship between the funds and other economic variables. The measures of risks and returns of security investment funds are two essential problems. From the view of methodology, the author analyzes methods of risk measures and methods of performance measures of security investment funds. The author also discusses the relationship between the security investment funds and the stability of stock market.The open-end fund is the direction of the development of Chinese security investment funds in the future. From the view of information economics and the functional perspective, the author gives economic explanation to this developmental trend. But the author argues that China still hasn't been provided with the conditions to develop open-end funds on a large scale, and closed-end funds are still a better choice at the moment.