Fund performance measurement is a measure of fund managers' investment ability, and its purpose is to identify outstanding fund managers with extraordinary investment ability. The measurement of fund performance is different from the measurement of fund portfolio performance itself. The measurement of fund portfolio performance itself focuses on the return of the portfolio itself, without considering the influence of different investment objectives, investment scope, investment constraints, portfolio risk and investment style on fund portfolio performance. However, in order to correctly measure the investment ability of fund managers, factors other than investment ability must be controlled or compared in fund performance measurement.

According to the investment performance of the fund manager, investors need to know to what extent the fund has achieved its investment objectives, monitor the investment strategy of the fund, and provide decision-making basis for further investment selection; Investment consultants need to provide effective investment advice to investors according to the investment performance of the fund; On the one hand, fund companies will use performance for marketing to attract fund investment, on the other hand, they will monitor investment according to the feedback mechanism provided by performance measurement to help improve investment operation; The management department will also regulate how to use performance measurement indicators reasonably from the perspective of protecting the interests of investors. All these aspects depend on the correct measurement of fund performance and the proper use of performance information. It goes without saying that incorrect performance information and improper use of performance information will bring adverse or even disastrous consequences.