The Influences Of Characteristics Of Mutual Fund Management Team On Fund Performance

With the rapid development of China’s economy in recent years, the security investment industry has also caught up on the train of the good era. Mutual fund, as a new financial investment tool, draws more and more attention from investors. At present, researches about mutual fund in China mainly focus on the evaluation of performance; scholars seldom pay attention to the characteristics of fund managers. While fund managers play a big role in the process of fund management, because they are the direct investment operators and the quality of a firm’s fund management team to some extent determines the firm’s performance. Therefore, figuring out how to improve fund performance from the point of fund mangers’perspectives are important.By the end of September in2013, statistics coming from www.chinafund.cn showed that there were1442fund managers in China and90%of them have master degree or doctor degree. The fund industry has become one of the most attractive job markets in financial field. Meanwhile, fund companies began to establish an effective fund management team to manage fund decision strategies, the style that one manager is in charge of a single fund is now out of date. Besides, one thing we should state is that the fund management team in this paper refers to the collection of each firm’s fund managers in the period of one year, because we are trying to study how the characteristics of fund management team influence firms’integrate performance from the point of fund management firms.Based on data coming from57mutual fund management firms, our research found that the more members a fund management team has, the more stable of its investment style is, while the longer the members of a fund management team cooperate with each other and the higher gender heterogeneity exists in this team, the more radical of its investment style is. In addition, the number of fund managers, the age heterogeneity and the period of co-managing a fund in a fund management team are positively associated with fund performance, while the gender heterogeneity is negatively associated with fund performance. And the more mangers who own MBA diploma, CPA diploma or CFA diploma exist in the team, the more risky investment strategy the team tends to use. If the team has more members and fund managers cooperate with each other in a longer period, the risk of an investment portfolio is relatively smaller. Moreover, tournament hypothesis does exist in China Investment Fund Industry especially when economy is in a downward phase and the possibility whether a fund manager will induce higher investment portfolio risk when his or her term of office close to end is related to current economy situation. Our empirical results demonstrated that fund companies should properly adjust the proportion of different categories of fund managers in a team to gain more investment benefits.