Supervisory Fund Based On Portfolio Perspective And Enterprise Risk Taking

In view of China's economic transition period and the concept of new development and the dual characteristics of institutional roles,this paper empirically examines the relationship between supervision funds based on the portfolio perspective and corporate risk taking by using the data of A-share listed companies from 2003 to 2015.It further analyzes the regulatory effects of industry market competition,macroeconomic cycle,and separation of ultimate controller's control and cashflow rights.The study found that:(1)Loss avoidance characteristics based on prospect theory and herding behavior caused by information costs and supervision costs,supervisory funds are negatively related to corporate risk taking;(2)When the market competition is not intense,checks and balances between companies are relatively small and their operations with less uncertainty,and the stable strategy of supervised funds conflicts with the potential expansionary activities of the company,thus,the negative correlation between supervised funds and corporate risk taking is stronger at this time;(3)The growth expectation brought by the macroeconomic boom stimulated the fund's investment in the company and the company's risk expansion tendency.In this case,the monitoring fund with risk aversion characteristics has a more obvious inhibitory effect on the company's risk taking;(4)When the two rights are separated,the suppression of risky investment or "empty" tendency of ultimate controller by supervised funds is even more obvious.That is to say,the negative correlation between supervision funds and corporate risk taking is more obvious.In this paper,the effects of endogeneity on the conclusions were investigated by using PSM,controlling individual firm fixed effects,new control variables,instrumental variables,subsample test includes bootstrap method and non-return random sampling and manufacturing samples.The results of the robustness test show that the conclusion of this paper is relatively robust and has high external validity.The conclusion of this paper enriches the analysis of institutional governance behavior and short-termism behavior and provides policy suggestions and considerations for the regulators to further improve market supervision and guidance.