Research On Investment Style Convergence Of Stock Open-end Fund And Its Impact On Fund Performance

With the rapid growth of China's economy,the wealth level of residents is increasing,and the demand for public financial asset allocation is gradually released.However,because the general public does not have enough investment ability and experience,it's difficult to realize the value preservation and appreciation of wealth,and the rapid development of funds will help alleviate this contradiction.However,in the actual operation process,the fund deviates from the original established investment style,resulting in the actual convergence style.This will weaken the information transfer function of nominal style and increase the risk of capital loss for investors.Meanwhile,what kind of impact will convergence have on fund performance? How to make a reasonable choice between convergence strategy and outlier strategy? The academic circles do not have a unified understanding.Based on this,this paper takes stock-based open-end funds as the research sample,and on the basis of quantifying style outlier,empirically studies the impact of style convergence on fund performance.In this paper,three verification methods of style convergence are proposed,and on this basis,the corresponding outlier index is designed to reflect style convergence laterally.By combining the actual outlier data,style convergence is verified.Finally,from the two dimensions of market size and value-growth,this paper makes an in-depth discussion on how style convergence affects fund performance,and carries out corresponding robustness tests under different scenarios.The research finds that there is convergence of investment styles in sample funds,especially in the dimension of value-growth.The overall outlier index only reflects the total level of fund outlier,and blurs the structure information of fund style outlier.In the long run,in a complete stock market cycle,style convergence will reduce the risk premium and risk-adjusted fund returns,and increase the total risk of the fund,while style deviation is oppposite.In addition,in the long run,maintaining a low degree of convergence and enhancing the contribution of the degree of alienation to the overall degree of alienation in the dimension of value-growth will help to improve the risk premium and risk-adjusted fund returns.Considering the development stage and inherent defects of domestic securities market,convergence of investment style may not be a relatively good choice.