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Mutual Fund Growth in Standard and Specialist Market Segments

Author

Listed:
  • Stefan Ruenzi

    (Dpeartment of Finance, University of Cologne)

Abstract
We examine differences in the performance flow relationship (PFR) between different segments of the fund industry. Such differences can be caused by distinct mutual fund investors’ characteristics in different segments. In our empirical study of the US equity mutual fund industry in 1993-2001, we find a much more convex PFR in standard segments than in specialist segments. Furthermore, our results suggest that investors in the latter are more fee- and risk-aware than investors in standard segments. Overall, these results hint at investors in specialist segments being more sophisticated than investors in standard segments. Our results should have serious implications for the management of investment companies and for the behavior of fund managers.

Suggested Citation

  • Stefan Ruenzi, 2004. "Mutual Fund Growth in Standard and Specialist Market Segments," Finance 0406005, University Library of Munich, Germany, revised 27 Jun 2004.
    • Handle: RePEc:wpa:wuwpfi:0406005
    Note: Type of Document - pdf; pages: 23
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    References listed on IDEAS

    as
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    Cited by:

    1. Alexander Kempf & Stefan Ruenzi, 2008. "Family Matters: Rankings Within Fund Families and Fund Inflows," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 35(1‐2), pages 177-199, January.
    2. Jacquelyn Humphrey & Darren Lee, 2011. "Australian Socially Responsible Funds: Performance, Risk and Screening Intensity," Journal of Business Ethics, Springer, vol. 102(4), pages 519-535, September.
    3. Martinez Meyers, Susana & Ferrero-Ferrero, Idoya & Muñoz-Torres, María Jesus, 2024. "ARE sustainable funds doing the talk and the walk? An ESG score analysis of fund portfolio holdings," International Review of Economics & Finance, Elsevier, vol. 93(PA), pages 1526-1541.
    4. Ainulashikin Marzuki & Andrew C. Worthington, 2011. "Comparative fund flows for Malaysian Islamic and conventional domestic managed equity funds," Discussion Papers in Finance finance:201118, Griffith University, Department of Accounting, Finance and Economics.

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    More about this item

    Keywords

    Mutual Funds; Performance Flow Relationship; Fund Growth; Investor Sophistication;
    All these keywords.

    JEL classification:

    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors

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