Empirical Research On Risk Of Chinese Private Equity Investment Fund

Private equity investment fund develops rapidly in our country.The purpose of this paper is to summarize all kinds of risks facing Chinese private equity securities investment fund,and with reference to the seven factor model of six types of private securities investment fund risk investment profit by regression analysis,the empirical results to analyze all kinds of private equity exposure of different risk factors,and puts forward corresponding prevention advice.The development of foreign private equity is relatively mature,and foreign scholars have also made a comprehensive assessment of the risk of private equity,and constructed risk factors in line with the foreign market.Among many risk assessment models,the seven-factor model of private equity built by Fung and Hsieh can explain 80% of the risk returns of American private equity funds.Due to private equity securities investment fund China starts relatively late,most of domestic scholars research on the risk theory,the author combined with the actual situation of the Chinese market and the domestic scholars have found that the various risks faced by private equity funds,with reference to private equity funds these seven factors model building into a suitable for China's private equity fund risk factor,and the seven risk factors to explain the risk of private equity fund returns,according to the exposure of private equity for different risk factors to provide appropriate prevention advice.Article first comb the private equity risk prevention related literature at home and abroad were reviewed,by drawing on the successful experience of foreign private equity markets in the developed countries provide theoretical guidance for the perfection of China's private equity market,understanding of private equity fund,its characteristics,operation mode and source of risk,and produces a detailed analysis to private equity fund risk,targeted for the next step for private equity risk prevention provide a theoretical basis.Then analysis the current situation of the development of private fund in our country,and on the basis of the further study of the present stage our country private equity market risk situation,from two aspects of external environment and internal operation impact on China's private equity risk classification,and further summarizes the existing law,policy,market,investment,credit risk,operations,and so on six big class.Secondly,the risk of five categories(in addition to the legal risks)mapped to Fung and Hsieh,build private equity seven factors in the model,the seven factors can be divided into three categories: the first category to reflect the stock market risk factor,these factors mainly cover the risk of stock market,this kind of risk is a reflection of market risk and operational risk;The second type is the factor reflecting the risk of bond market,which mainly covers the risk of bond market.This kind of factor is the mapping of investment risk and policy risk.The third category is the risk factors of trend trading,which are mainly reflected in the risk of trend trading in bonds,currencies and futures markets.Such factors are the mapping of credit risk.Empirical analysis process is as follows: according to the private equity fund investment strategy will private equity is divided into six types,using 8 years of historical data in 2008-2008,with seven risk factors respectively for each type of private equity funds for empirical research,on different style fund,we choose the highest risk exposure factor to explain its returns.Finally,the paper gives some Suggestions on prevention and supervision through empirical conclusions,and tries to make a small theoretical contribution to the construction of a good development environment for China's private equity investment fund.The innovation of this paper lies in :(1)the innovation of research perspective.This paper increases the perspective of private fund operation mode when studying the external risk of private fund.(2)innovation of research thinking.This paper converts various risks faced by private equity investment funds into risk factors to more directly analyze the exposure degree of private equity to various risk factors;(3)innovation of research methods.By referring to Fama three-factor model and seven-factor model,this paper constructs seven risk factors in the Chinese market for multiple regression of private equity returns.Moreover,most of the regression results are significant,and the risk interpretation of private equity is convincing.