More pay more gain?—Empirical research on fund management corporation visiting listed company and its fund performance.

This paper investigates whether institutional investors obtain increased profits when they are diligent in site visit and is based on research on fund management corporations in China and their fund performance. We use two methods: one compares the fund performance difference between two adjacent quintiles sorted by fund size, and the other constructs regression model. Our sample consists of the site visit information of 58 fund corporations from 2010 to 2016. After conducting an ordinary least square(OLS) regression, we find that the more frequent fund corporations site visits lead to better fund performance, and that is more evident for moderate‐sized fund corporations. The results suggest that institutional investors obtain increased profit when they are diligent. The statement "more pay, more gain" is evident for fund management corporations during the growth period. For slightly larger and smaller‐sized fund management corporations, the statement "more pay, more gain" motivates fund management corporations to conduct visits. However, more frequent visits are not beneficial. [ABSTRACT FROM AUTHOR]