Wentao Xu^*, Junlin Wu, Kun Xie
College of Economics, Jinan University, Guangzhou, China.
DOI: 10.4236/jss.2015.311027   PDF    HTML     2,478 Downloads   3,149 Views   Citations

Abstract

In China, developing institutional investor, especially securities investment fund, becomes more and more important. In order to improve the level of company governance by bringing in institutional investor, China Securities Regulatory Commission supports the development of institutional investor by legislation and other polices. Papers about the relationship between fund holding and company performance are still not enough and a lot of researches don’t consider the effect of some moderator variables. This article mainly researched for the influence of shares heavily held by fund on the performance of company, using data of A-share listed companies in Shanghai and Shenzhen during 2007 to 2014. It also introduced two moderator variables to discuss whether there existed effects on company performance if the fund was the second largest shareholder or the holding company was state-owned. Actually, the empirical result showed that, the percentage of stocks held by fund had a positive relationship with company performance. If the fund was the second largest shareholder, it would strengthen the relationship between fund heavily holding stock and corporate performance. If the company whose stocks were held by fund was state- owned, the influence on company performance would weaken.

Keywords

Fund’s Heavy Position, Panel Data, Company Performance

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Conflicts of Interest

The authors declare no conflicts of interest.

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