TY  - JOUR
AB  - Purpose– The purpose of this paper is to study the determinants of aggregate fund flows to both equity and hybrid mutual funds. The authors test three hypotheses that help explaining the relationship between mutual fund flows and stock market returns, namely; the feedback-trader hypothesis, the price-pressure hypothesis, and the information-response hypothesis. Design/methodology/approach– The study relies on Swedish quarterly data on mutual fund flows over the period 1998-2013. The methodology is twofold; through the structural models (AR(1)) the authors can say something regarding the relationship between mutual fund flows and financial macro variables. The analysis is further strengthened by utilizing a vector autoregressive model to test for Granger causality in order to determine the order of events. Findings– Similar to both Warther (1995) and Jank (2012), the authors only find support for the information-response hypothesis. Additionally, the authors find new financial variables that have predictive power in determining mutual fund flows, namely; market fear (VIX), exchange rate, households’ expectation regarding inflation as well as outflows from mutual bond funds. Originality/value– The study contributes to the body of literature in three ways. First, it complements recent findings on determinants of mutual fund flows but the authors also add to the knowledge by included new macro financial variables describing the real economy. Second, the authors include a few additional variables. Third, the vast majority of previous studies have used US data, the authors add to that a deeper understanding of determinants of mutual fund flows in smaller economies by using Swedish data.
VL  - 41
IS  - 1
SN  - 0307-4358
DO  - 10.1108/MF-06-2013-0161
UR  - https://doi.org/10.1108/MF-06-2013-0161
AU  - Kopsch Fredrik
AU  - Song Han-Suck
AU  - Wilhelmsson Mats
PY  - 2015
Y1  - 2015/01/01
TI  - Determinants of mutual fund flows
T2  - Managerial Finance
PB  - Emerald Group Publishing Limited
SP  - 10
EP  - 25
Y2  - 2024/04/20
ER  -