China's Open-end Fund Performance Study

Ever since the out-coming of 《Experimental Law of open-end securities funds》 , the Chinese securities funds go into the all-rounded development period of open-end funds. Currently, open-end fund has become one of the most important institutional investors in securities market. The rapid development of open-end fund attributes to its advantage in its unique system advantage which effectively solves the problem of moral hazard caused by agent relation in the treaty of fund. The motivation-compatible information system guarantees the consistence of objectives of fund manager and investor.The development of Open-end fund promote the conception of rational investment in capital market and its investment conception of focusing on industries and selection of companies sets a good example to the market. The advantage of open-end fund' s system and investment conception are best explained by the performance of funds. It is beneficial to valuate fund' s performance by related parties and realize objectively problems in the operation of fund as well as helps the healthy development of open-end fund through conducting profound research on performance of funds,This dissertation analyses the performance of 34 open-end funds from November, 2003 to December, 2004. It tests the performance of our open-end funds from several aspects, such as the analysis of risk-adjusted earning ratio, the analysis of capability to select stocks and time, the analysis of the belonging of performance and the analysis of performance sustainability. The result shows open-end funds perform well and prove its ability of stock-picking when market is fragile, which test the success of picking strategy of funds in investment practice. At the same time, the result does not show funds' obvious ability to select time and the sustainability of it short-term performance.