The Theory Model of Fund Manager's Incentives on Relative Performance Contracts

Based on the studies of fund manager's relative performance merchanism,this paper builds a model containing three competitive fund managers to study fund manager's incentives on relative performance contracts,and recognizes that special relative performance contracts may cause unconventional investment decision orherd behavior. It suggests that the goverment should speed up the construction of scientific and reasonable evaluation system of fond managers,and provide a better external environment for the long-term development of the fund industry.