Burned by leverage? Flows and fragility in bond mutual funds

The Behavior of Investor Flows in Corporate Bond Mutual Funds

This paper comprehensively examines investor flows in corporate bond mutual funds. Despite extensive studies in equity funds, little is known about investor flows in bond funds which, with several distinct features, can offer new insights. Using a large sample of corporate bond funds, we first document that flows are sensitive to both fund performance and macro conditions. Then, we show that fl...

Mutual Funds by Edwin

Mutual Funds, Part II: Fund Flows and Security Returns

T his study is the second in a two-part analysis of the mutual fund industry. The first part (Fortune 1997, referred to here as " Part I ") examined the basic structure of the industry and discussed the historical relationship between mutual fund flows and returns on both short-term and long-term financial instruments. That study ended with a discussion of the role that momentum investing by mu...

Persistence and Fund Flows of the Worst Performing Mutual Funds

We document that the observed persistence amongst the worst performing actively managed mutual funds is attributable to funds that have performed poorly both in the current and prior year. Consistent with the Berk and Green (2004) model, we demonstrate that this persistence results from an unwillingness of investors in these funds to respond to bad performance by withdrawing their capital. In c...

Portfolio Diversification and Net Selectivity Performance of Mutual Funds in Iran by Using Fama Decomposition Model

T he main purpose of this paper is to analyze the performance of mutual funds in Iran by using Fama decomposition model (1972). Thus, daily data of 55 mutual funds during a four-year period from 21/3/2014 to 21/3/2018 were investigated. To achieve this goal, firstly, the performance of mutual funds was broken down into Fama components, and it was shown that the diversification perfor...