Two Essays on Managerial Behaviors in the Mutual Fund Industry Essay 1: A Life-Cycle Analysis of Performance and Growth in U.S. Mutual Funds Essay 2: Can Mutual Fund Window-Dressing Promote Fund Flows?
نویسندگان
چکیده
We investigate the effectiveness of window-dressing as a potential strategy to be used by mutual fund managers to promote fund flows. Using a rank gap measure as a proxy for the likelihood that window-dressing has occurred, we find that fund investors as whole punish those managers who are suspected to have engaged in window-dressing. That is, we find a negative relation between the window-dressing measure and net fund flows in subsequent quarters after controlling for fund performance, size, expense ratio, and other pertinent characteristics. We also find that window-dressing leads to higher trading activities and lower fund performance. JEL Classification: G11; G20
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