Analyzing Effects Of Changing Fund Investment Style On Fund Performance

Since the first batch of 5 fund sold in 1998, we have witnessed the vigorous development of the fund industry. In today's market, the number of funds has reached more than 1000, but the similarity between each product is pretty high. To be known by the investors, fund should declare their own style, so that investors could find their risk and return matching the product. However, in the actual operation process, many factors affect the stable of investment style, such as market environment, the ranking pressure, the herd effect and fund manager's investment decisions. Although in most cases, the fund managers change the investment style in order to find better investment opportunities and get access to higher returns; however this kind of change deviates the fund from investors' original intention to buy it. In addition, we have no idea if the fund manager can handle the new investment style. Therefore, this paper selects the stock based open-end fund as the research object. First, we start to analyze the real investment style of such research objects from 2011 to 2014. Then, we try to figure out the relation between the degree to which the investment style changes and the profit of fund. We hope the research results can provide theoretical support for the fund investors, the fund companies and securities market supervision department. We would like to see that every part of the market can make a contribution to the long term prosperous of the market.