Study On The Volatility Spillover Effects Of Chinese Market Of Open-ended Fund

With rapid economic development, Chinese financial markets are playing an increasinglyimportant role in the economic development, and the volatility’s risk of financial market willaffect the environment’ stability of the country’s economic development. As one of the maincomponents of Chinese financial market, the fund market has a short history but beendeveloping very rapidly. Especially the emergence and rapid expansion of open-end fundshave led to continue rising of Chinese fund industry’s position in the financial markets. Thevigorous development and investment of fund market as a major investor in capital marketsespecially open-ended fund market which is close to Chinese economic situation areIncreasingly affecting the stability of Chinese financial markets and economy. Therefore, thestudy on the volatility spillover effects of Chinese market of open-ended fund has animportant theoretical and practical significance.This paper studying the volatility spillover effects of the market of open-ended fund on otherfinancial market includes two aspects: the formation mechanism and the path of the volatilityspillover effect. In the course of the study, this paper firstly introduces the successfulresearch and conclusions of the scholars at home and abroad, and then introduces theoverview of Chinese market of open-ended fund and the definition of volatility spilloverseffects, and finally analyzes the formation of the mechanism of the volatility spillover effectsand empirical analyzes of the volatility spillover effects on the basis of the results ofprevious studies.By that, on the mechanism of the volatility spillover effects, the volatility spillover of themarket of open-ended fund exist the balance sheet effect, the wealth effect, herd behavior,the effects of investment and the flow effects of international capital;On the empirical analysis, the market of open-ended fund of stock and bond constitutingChinese market of open-ended fund exist volatility spillover effects on stock market andbond market respectively but except the money market, and they have synergism effects onthe stock market. The existence of the volatility spillover effects of the market of open-endedfund depend on the size of open-end funds as well as the level of participation of thefinancial markets.