Insights

“With the net asset value of the fund increasing, why is my wallet shrinking?” The soul-searching question of investors implies a “conspiracy” between banks and fund companies. Statistics show that on average, a fund manager oversees 2.7 funds in China, far more than 1.3 in the United States. What’s beneath is the interest chain of banks by binding new fund issuance with custodian fees, that is, in exchange for the “traffic access” of bank channels, fund companies have to “frequently launch new funds,” resulting in the fact that old funds get forgotten.

Days ago, the latest research of Professor Ye Shuai and Professor Zhang Jinfan from the School of Management and Economics (SME) of The Chinese University of Hong Kong, Shenzhen (CUHK-Shenzhen), named Excessive Issuance of New Funds in China and Its Implication on Investor Protection, was published in the latest issue of the Journal of Financial Research.

About the author

Ye Shuai

Assistant Professor, SME, CUHK-Shenzhen

Research Field

Asset pricing and market microstructure

Zhang Jinfan

Associate Professor, SME, CUHK-Shenzhen

Area Head of Finance

Research Field

Chinese economy, capital markets and financial institutions, and digital economy

Co-author

Zheng Kaixuan

Master of Financial Engineering and Research Assistant, CUHK-Shenzhen