Spillover Effects in Mutual Fund Companies

Why Do Mutual Fund Advisory Contracts Change? Performance, Growth, and Spillover Effects

We examine changes in equity mutual funds’’ investment advisory contracts. There are substantial advisory compensation rate changes in both directions, with typical percentage rate shifts exceeding one-fourth. We find that rate increases are associated with superior past marketadjusted performance, whereas rate decreases reflect economies of scale associated with growth, and are not associated ...

The MUTUAL FUND INDUSTRY

Mutual Fund Objective Misclassification∗

Mutual funds are usually classified based on their stated objectives. If the stated objectives are not the actual objectives the funds pursue, conclusions drawn by investors and researchers based on the stated objectives will be misleading. This study classifies funds based on their attributes (characteristics, investment style, and risk/return measures). We find that the stated objectives of m...

Evaluating Mutual Fund Performance

We study standard mutual fund performance measures, using simulated funds whose characteristics mimic actual funds. We find that performance measures used in previous mutual fund research have little ability to detect economically large magnitudes ~e.g., three percent per year! of abnormal fund performance, particularly if a fund’s style characteristics differ from those of the value-weighted m...

Heterogeneity and peer effects in mutual fund proxy voting

This paper studies voting in corporate director elections. We construct a comprehensive data set of 2,058,788 mutual fund votes over a two-year period. We find systematic heterogeneity in voting: some funds are consistently more management-friendly than others. We also establish the presence of peer effects: a fund is more likely to oppose management when other funds are more likely to oppose i...