The excess return of asset allocation mainly examines the fund manager's timing ability, that is, he dynamically adjusts the contribution of various assets such as stocks, bonds and cash to the fund's net value by judging the changes in the market environment on the basis of following the provisions of the contract. In actual investment, some partial stock fund managers always keep high stock positions and downplay timing. This kind of fund has a more radical style, and often gets better excess returns when the market goes up, but the losses are relatively heavy when the market goes down. Some funds are used to keeping low stock positions. These products are often very defensive in a bear market, but their returns are limited when the market rises.
2, the industry distribution of excess returns
From the perspective of industry allocation, there are significant differences in the degree to which industries benefit from economic growth in different market stages. Therefore, it is entirely possible to obtain excess returns that greatly outperform the market average through staged over-allocation of booming industries. The deviation of the average allocation ratio of funds in a certain industry relative to that of peers multiplied by the index rate of return of the industry is the excess return of industry allocation, which represents the active management of fund managers in industry allocation. If the allocation ratios of Fund A to finance, cultural media and electronic information were 2%, 5% and 10% respectively at the end of the third quarter of this year, and the allocation ratios of peers were 12%, 2% and 4% respectively, the growth rates of the three industries since the end of the third quarter were -5.7% and-10, respectively.
In practice, some fund managers tend to concentrate their investments and allocate most of their stock positions to a few familiar and promising industries. Overallocation of these industries may bring explosive growth and increase short-term excess returns, but it may also increase the fluctuation of fund net value; Some fund managers adopt a balanced allocation strategy to evenly allocate the proportion of various industries. This kind of fund can hedge the fundamental risks of different industries to a certain extent, and its performance is relatively stable, but at the same time it is difficult to obtain the excess returns of the industries.
3. Individual stocks choose excess returns.
The excess return of stock selection is reflected in the fund manager's in-depth study of individual stocks and accurate judgment of trading timing. In the total excess return of the fund, after excluding the excess return of asset allocation and industry allocation, the excess return is selected for individual stocks of the fund. In fact, every fund manager has his own expertise in the investment field. If he has no excellent ability in asset allocation and industry rotation, he can also dig deep into individual stocks and select stocks with long-term growth potential, and make up for his shortcomings in the other two aspects by accurately judging the trading timing, so as to improve the overall income level of the fund.
The distribution of excess returns of private equity funds can be divided into asset allocation excess returns, industry allocation excess returns and individual stock selection excess returns according to different nature. The distribution methods of three different types of excess income are also different, so friends must analyze the problem of excess income distribution in contact with private equity funds in detail according to their own actual situation.