Chinese mutual fund stock-holding characteristics: a tale of two sentiments

Liu Liu

doi:10.1080/13504851.2026.2668661

Chinese mutual fund stock-holding characteristics: a tale of two sentiments

Liu Liu

Department of Foundational Mathematics

Research output: Contribution to journal › Article › peer-review

Abstract

Do Chinese mutual funds hold different stocks when the market sentiment is high or low? The answer depends on which sentiment is used. In the bullish sentiment of stock market triumphs, mutual funds roughly keep calm, but become conservative in holding past-winner stocks. In the period of economic over-optimism, mutual funds tend to hold big, high-valuation and past-winner stocks. These findings point to a hint of context-dependent irrationality for Chinese mutual funds.

Original language	English
Journal	Applied Economics Letters
DOIs	https://doi.org/10.1080/13504851.2026.2668661
Publication status	E-pub ahead of print - 2026

Keywords

Mutual fund holdings
Stock characteristics
Market sentiment
Behavioural finance

Access to Document

10.1080/13504851.2026.2668661

Cite this

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abstract = "Do Chinese mutual funds hold different stocks when the market sentiment is high or low? The answer depends on which sentiment is used. In the bullish sentiment of stock market triumphs, mutual funds roughly keep calm, but become conservative in holding past-winner stocks. In the period of economic over-optimism, mutual funds tend to hold big, high-valuation and past-winner stocks. These findings point to a hint of context-dependent irrationality for Chinese mutual funds.",

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