Research On The Impact Of Fund Awards On Fund Performance And Share

China’s fund market has developed rapidly in recent years,and fund investment has become a very important investment channel for ordinary investors with its characteristics of low investment threshold,diversified investment risk,professional management,and high rate of return.However,individual investors often have limited investment experience,and generally lack knowledge reserves of financial markets.Therefore,investors often need to rely on the evaluation of external professional institutions when investing in funds.As the most public external evaluation activity,the fund awards play an important role in this.After more than ten years of development,China has formed three authoritative awards:Golden Bull Award,Golden Fund Award,Star Fund Award,which are well recognized by the market and officials.On the one hand,fund awards may stimulate the purchase impulse of investors,thereby affecting the change of the fund’s share;On the other hand,fund awards may also have a signal effect:an effective fund award mechanism can screen out funds with excellent operating ability,so as to have a certain ability to explain future fund performance.Based on the above considerations,this paper makes a special analysis of how fund awards affect fund performance and shares.In order to explore the impact of the fund award mechanism,this paper selects 490 equity open-end funds issued before January 1,2016 as a research sample,covering a total of 26 quarters from the second quarter of 2016 to the third quarter of 2022.In this paper,the fund award is regarded as a quasi-natural experiment,the award-winning fund is set as the experimental group,and the unaward-winning fund is set as the control group,and the did model is used to study this issue.In order to further explore the timeliness of the impact of fund awards,this paper uses a dynamic effect model to test.Finally,this paper passes the robustness test and concludes the following points:First,there is a positive correlation between the fund’s awards and the fund’s subsequent performance.The net unit value of the fund after winning still be significantly higher than before winning the award.All else being equal,the average net unit value of the funds that won the three awards increased by 0.481 compared to before the award.Second,there is a positive correlation between the fund’s awards and the fund’s ex post shares.The fund’s share after winning the award still be significantly higher than before winning the award.All else being equal,the average share of funds that won the three awards increased by 13,100 shares compared with before the award.Third,the results of dynamic effect analysis show that the performance improvement of the fund after winning the award has a certain degree of sustainability.The fund’s performance has been positive in the five years since the fund won the award,and the annual growth rate of net unit value has remained relatively stable.At the same time,the growth rate of the share of the winning funds has been decreasing year by year.The findings of this paper will help the academic and practical circles to better understand the impact of local fund awards on the market,and hope that this paper will play a role in introducing bricks and driving more in-depth research in the future.