Style Consistency and Industry Concentration of Chinese Mutual Funds
Loading...
Date
2019-07-10
DOI
Open Access Location
Journal Title
Journal ISSN
Volume Title
Publisher
Rights
The Author(s)
Abstract
This paper provides a comprehensive analysis on the relationship between the mutual funds style consistency and performances in China. Using characteristic-based and factor-based analysis, our results indicate that mutual fund managers have stock picking talents over time, with relative weak ability to time the market. Style investments contribute the most to funds’ gross returns. Active funds exhibit lower style consistency but still realise better net returns compared to their passive counterparts. Results further suggest that mutual fund managers who concentrate their holdings in certain industries perform better after controlling for common risk factors. Therefore, we conclude that Chinese mutual fund managers have better industry selection ability.
Description
Keywords
style consistency, mutual funds, industry concentration
Citation
2019