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Title: Trust in financial markets : a study of fund management in China
Author: Gao, Xiaowen
ISNI:       0000 0004 2716 9164
Awarding Body: University of Reading
Current Institution: University of Reading
Date of Award: 2011
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The study is motivated by an increased appreciation of the importance of trust in improving business performance in competitive markets. In this thesis, three types of trust - personal trust, organizational trust and system trust have been defined and identified in Chinese fund managers' investment process. Personal trust refers to one's trust in family members and close friends. Organizational trust refers to one's trust in an organization. System trust refers to one's trust in a country's legal system. The impacts of different types of trust on mutual funds' performance are then examined empirically. Through face-to-face and telephone interviews with 96 equity fund managers, this paper reveals Chinese fund managers' attitude on what information they prefer to use in their investment decision making process and how they communicate with publicly traded companies listed on the Shanghai and Shenzhen stock markets. Data was collected from both survey and various public sources. The main function of survey is to identify different types of trust claimed by the study. Trust variables were then linked to different measurements of funds' performance. Using a multiple regression analysis, a positive relationship is found between Chinese fund managers' stock selection performance and personal trust, while a negative association emerges between stock selection and system trust. No evidence is found to link between portfolio performance and organizational trust. This study contributes to the study of inter-organizational trust by providing new empirical evidence on how personal trust has assisted the Chinese fund managers in improving their portfolio returns. One major policy implication that can be drawn IS that being well- connected should be an important strategic consideration for the investment fund companies when they recruit and train new fund managers, especially in the Chinese financial markets.
Supervisor: Not available Sponsor: Not available
Qualification Name: Thesis (Ph.D.) Qualification Level: Doctoral
EThOS ID:  DOI: Not available