Tests on the Relationship of Fund Performance and Net Fund Flow

Wei Hu

Abstract


The relationship between net fund flow and performance of open-end funds was studied in this paper. The empirical tests on the performance and size of open-end funds in China show that the net fund flow of funds is positively correlated with pre-performance of funds, while the performance of funds is negatively correlated with the net fund flow of funds. These empirical studies imply that investors chose funds according to their historical performance, while the growing size decreases the funds’ capability of achieving excellent performance.

Full Text: PDF DOI: 10.5539/ijbm.v3n8p14

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International Journal of Business and Management   ISSN 1833-3850 (Print)   ISSN 1833-8119 (Online)

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