Research On Market Timing Ability Of China Open-end Stock Funds

In recent years,investors’ demand for open-end funds shows a trend of continuous growth,which directly promotes the research on fund performance evaluation by relevant scholars and fund practitioners..Evaluation of fund performance is of great significance in both academic research and practical application,and the focus of this research is mainly on fund timing ability.Fund’s timing ability refers to the fund manager’s macro ability to grasp the overall trend of the securities market.According to the prediction of market trend,they choose to enter the market or exit the market,increase or reduce the proportion of investment risk assets and adjust the proportion of risk-free assets accordingly.In face of changes in market situation,they immediately adjust the position of the investment portfolio to maximize the investment income and reduce investment loss.The article studies and analyzes the timing ability of 223 qualified open-ended stock funds in China from 2014 to 2018,H-M timing ability evaluation model was used to test timing ability of sample funds,and results shows 52 funds that have the timing ability.The result of empirical test shows that only a small part of the sample funds have the ability of timing,and the significance of timing ability is a little poor.With values of 52 funds timing capabilities,further research can be carried out.Firstly,a formula for calculating the fund’s timing ability coefficient was established according to the H-M evaluation model,and the value of each fund’s timing ability coefficient y was calculated and we can compare each fund’s timing ability with y.Then we can analyze the direct relationship between the fund’s income level,scale and timing ability,and explore the factors affecting the fund’s timing ability.The study found that there is a significant positive correlation between various income indexes of the fund and its timing ability,however,there is no significant correlation between timing ability and fund size.Finally,based on the results of the analysis,the research conclusions are given,combined with the actual situation,relevant policies and suggestions are given in the establishment of fund performance evaluation system,fund management rate setting and fund manager constraint mechanism.