An Empirical Study On Influence Of Manager Feature On Private Fund Performance In China

Private funds have become one of the major institutional investors in the capital markets as the ecnonmy developes in china.The current research focuses on laws,regulations and supervisions about private funds,but little quantitative research has been involved,let alone the research on the relationship between private funds managers and fund performance. For the common investors,fund managers are undoubtly of geat importance as they are the direct manipulators.Just like a saying in the western capital markets:to pick up a fund is to pick up a fund manager.So what kind of fund managers will be able to bing more in return? I believe this is the main question that every common investors will ask before they invest the private funds.In this paper,we will study the relationship between the fund managers'features and fund performance ,hoping to find some significant messages that can give directions to the common investors.The premise of the study on the relationship between fund managers and fund performance is that fund managers should own the investment ability (security selection ability,market timing ability) so that they can positively influce fund performance,or else the study on the relationship becomes unvaluable.So in this paper,we firstly use the T-M model,H-M model and Jense-alpha to examin the investment ability of private fund managers.The resutl shows that China's private fund managers generally own the investment ability,and specifically they have weak timing ability but better security selection ability.This conclusion builds the foundation for the subsequent research on the relationship between the fund managers'features and the funds'performance. On the basis of studies above,we studied the relationship between fund managers'features ( including age,experience,graduate school,education,professional background,abroad background,MBA degree,number of managed funds,ect ) and fund performance in different market conditions (bull market,bear market) so that the conclusions can be more represented and reliable.The empirical results show that: fund managers'age is a factor affecting the performance,and young managers are more suitable for private fund profession; fund performance is not proportional to the level of fund managers'education;fund managers that graduated from famous universities tend to achieve better results;fund managers that ever worked in public fund companies or asset-managing department of security companies are more worthy of the trust of investors in the market;the fact that both experience and MBA degree affect the fund performance positively in decling market but negatively in rising market reveals that fund managers who own both systematic investment theory and practical experience tend to be more rational and achive stable returns.All these conclusions are of great significance for both investors and regulatory authorities.