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Abstract

Details

The Savvy Investor's Guide to Building Wealth Through Traditional Investments
Type: Book
ISBN: 978-1-83909-608-2

Abstract

Details

Investment Traps Exposed
Type: Book
ISBN: 978-1-78714-253-4

Open Access
Article
Publication date: 22 September 2023

Richard Danquah and Baorong Yu

The study assess the selection ability and market timing skills of mutual fund and unit trust managers in Ghana.

Abstract

Purpose

The study assess the selection ability and market timing skills of mutual fund and unit trust managers in Ghana.

Design/methodology/approach

The study uses an improved survivorship bias-free dataset of yearly after-fee returns of all mutual funds and unit trusts operating in Ghana from January 2011 to December 2019, cumulating in nine years of quantitative fund data. The authors assess Mutual funds and Unit trusts that ever existed, “alive” or “dead,” over the sample period in the study. The authors construct factor loadings to enable the application of multifactor models in the analysis. The authors apply the unconditional versions of the Jensen alpha, Fama-French three-factor, and Carhart four-factor models to determine the selection ability and market timing skills of 32 mutual funds and 17 unit trusts. The authors deploy HAC-consistent robust standard errors to the OLS estimations to subdue the effect of heterogeneity and autocorrelation.

Findings

The results indicate that, on average, mutual funds and unit trust managers possess market timing skills but no selection ability. When the results are decomposed into fund types, fixed-income and balanced mutual fund managers possess selection ability and market timing skills.

Originality/value

To the authors' best knowledge, this study is the earliest to examine the selection ability and market timing skills of both mutual fund and unit trust managers in Sub-Saharan Africa (SSA). It is also the earliest to construct factor loadings for the Ghana stock market.

Details

Business Analyst Journal, vol. 44 no. 1
Type: Research Article
ISSN: 0973-211X

Keywords

Article
Publication date: 25 August 2023

Niket Thakker, Hitesh Kalro, Mayank Joshipura and Prashant Mishra

This study examines current dynamics, consolidates current knowledge, elicits trends, identifies and analyzes primary research clusters, and offers future research directions for…

Abstract

Purpose

This study examines current dynamics, consolidates current knowledge, elicits trends, identifies and analyzes primary research clusters, and offers future research directions for mutual fund marketing.

Design/methodology/approach

Using bibliographic information from the SCOPUS database, this study used sequential bibliometric (143 documents) and content analyses (37 documents). Bibliometric analysis aids descriptive analysis and science mapping, while content analysis facilitates identifying and analyzing research clusters and provides future research directions.

Findings

The study identifies publication trends, the most relevant authors, and journal articles and unveils the knowledge structures of the field. Analysis of bibliographic coupling reveals the following significant clusters: (1) socially responsible investing and investor preferences, (2) investor factors and traits and investment decisions; (3) external factors, mutual funds' performance and proxy information; (4) the role of disclosures and ratings in shaping investment choices, and (5) cognitive biases, information processing errors and investor behavior. Finally, it offers future research directions.

Research limitations/implications

Using different databases, bibliometric analysis tools, study periods or article screening criteria for the study might yield different results. However, this study's significant findings are robust to such alternatives.

Practical implications

This study summarizes primary clusters and identifies gaps in the current literature, which helps scholars, practitioners, regulators and policymakers understand the nuances of mutual funds marketing. Future studies may focus on the role of online and offline integration, using neuroscience for data m and contemporary investment behavior models.

Originality/value

This is the first study to apply a two-stage sequential hybrid review of articles published over the last decade in high-quality journals, enabling an analysis of the depth and breadth of mutual funds marketing research.

Details

International Journal of Bank Marketing, vol. 41 no. 7
Type: Research Article
ISSN: 0265-2323

Keywords

Article
Publication date: 12 April 2023

Ioannis Tampakoudis, Nikolaos Kiosses and Konstantinos Petridis

The purpose of this study is to evaluate the performance of mutual funds during the COVID-19 pandemic with environmental, social and governance (ESG) criteria. The main research…

1136

Abstract

Purpose

The purpose of this study is to evaluate the performance of mutual funds during the COVID-19 pandemic with environmental, social and governance (ESG) criteria. The main research question is whether mutual fund performance differs with respect to the level of the mutual fund’s ESG score.

Design/methodology/approach

The data set contains global fund data, and mutual fund performance is analyzed using two types of data envelopment analysis (DEA) models: the DEA portfolio index (DPEI) and the range direction measure (RDM) DEA. Propensity score matching and logistic regression are also applied.

Findings

The results reveal that: nonequity mutual funds present significantly higher performance compared to the performance of equity mutual funds; mutual funds with high ESG scores are associated with significantly higher performance compared to those with low to medium ESG scores; funds with high ESG scores experience higher performance irrespective of their type; and efficiency scores derived from the RDM DEA are significantly higher than those derived from the DPEI model.

Research limitations/implications

Investors, fund managers and market participants can benefit from the findings of this study and improve their investment decision-making process, including more sustainable funds in their portfolios. Regulators and policymakers should further promote or even require the inclusion of more sustainable investments in the financial products offered by institutional investors. The main limitation of the study is related to data availability regarding the ESG score of mutual funds.

Originality/value

To the best of the authors’ knowledge, this is the first study that provides robust evidence in support of a positive association between ESG scores and mutual fund performance during the pandemic-induced crisis applying a DEA methodology.

Details

Corporate Governance: The International Journal of Business in Society, vol. 23 no. 7
Type: Research Article
ISSN: 1472-0701

Keywords

Article
Publication date: 14 March 2008

Jeff Levering

The purpose of this paper is to explain the risk of bad mutual fund data for a financial services firm that sells mutual funds and to recommend steps a firm can take to ensure the…

840

Abstract

Purpose

The purpose of this paper is to explain the risk of bad mutual fund data for a financial services firm that sells mutual funds and to recommend steps a firm can take to ensure the reliability of its mutual fund data.

Design/methodology/approach

Explains problems caused by missing data, including the “breakpoint issue,” the best sources of mutual fund information, problems firms have retrieving and compiling that information, and weaknesses in a free service (the “Service”) provided by a well known industry utility and securities depository that related to coverage, completeness, and cost. Recommends seven actionable steps a firm can take to ensure the accuracy of its mutual fund data.

Findings

Firms offering funds may sell billions of dollars of funds every week, and maintain considerably more on their books, but frequently they pay scant attention to the accuracy of their mutual fund reference data. The breakpoint issue is alive and well today, and would seriously erode investor and regulatory confidence if this fact became better known. For many firms, discrepancies in data result from funds having one policy disclosed to the SEC while their distributors use entirely different ones. Firms now realize that ensuring accurate reference data is no longer an issue that can be avoided.

Practical implications

Rather than operating under the false assumption that critical data is accurate, make sure you dedicate the time to examine your organization's use of mutual fund data to ensure efficient, ongoing investor relations and to ensure the overall reputation of your firm.

Originality/value

Professional advice from an experienced vendor of compliance systems and software.

Details

Journal of Investment Compliance, vol. 9 no. 1
Type: Research Article
ISSN: 1528-5812

Keywords

Article
Publication date: 12 January 2023

Yupei Liu, Weian Li and Qiankun Meng

This study aims to explore whether investors’ inattention is associated with firms’ environmental, social and governance (ESG) decoupling, which is defined as the misalignment…

1341

Abstract

Purpose

This study aims to explore whether investors’ inattention is associated with firms’ environmental, social and governance (ESG) decoupling, which is defined as the misalignment between the implementation and incorporation of ESG policies.

Design/methodology/approach

Focusing on a sample of the components of ESG ratings for China Securities Index (CSI) 300 companies between 2017 and 2019, the authors test the relationship between firms’ ESG decoupling level and mutual fund investors’ distraction by applying exogenous shocks to their portfolios.

Findings

The results show that firms with distracted mutual fund investors engage in more external than internal ESG actions, leading to a high ESG decoupling level. Mutual fund investors use “threat of exit” rather than “voice” as a governance mechanism to influence corporate ESG decoupling. While external ESG actions mitigate stock price crash risk, internal ESG actions increase firm value; firms with a high ESG decoupling level suffer lower valuations.

Practical implications

This study has implications for increasing the congruence between firms’ external and internal ESG actions, thereby improving firms’ ESG performance and long-term economic outcomes.

Social implications

This paper helps policy-makers and regulators to reassess how ESG policies can be implemented to be consistent with organizations’ core business activities.

Originality/value

Contributing to prior studies of greenwashing and corporate social responsibility decoupling, this paper extends decoupling literature by revisiting ESG impacts in an integrated framework and explores the antecedents of corporate ESG decoupling from the perspective of institutional investor monitoring.

Details

Sustainability Accounting, Management and Policy Journal, vol. 14 no. 1
Type: Research Article
ISSN: 2040-8021

Keywords

Article
Publication date: 2 May 2017

Zia-ur-Rehman Rao, Muhammad Zubair Tauni, Amjad Iqbal and Muhammad Umar

The purpose of this paper is to find whether Chinese equity funds outperform the market and do Chinese fund managers possess positive market timing ability. This study also aims…

1220

Abstract

Purpose

The purpose of this paper is to find whether Chinese equity funds outperform the market and do Chinese fund managers possess positive market timing ability. This study also aims to investigate whether well-performing (worst) funds of last year continue to perform well (worst) in the following year.

Design/methodology/approach

Capital Asset Pricing Model and Carhart four-factor model are used for performance analysis, whereas for analyzing market timing ability, the Treynor and Mazuy (1966) and Henriksson and Merton (1981) models are applied. To investigate persistence in the performance of Chinese equity funds, all equity funds are divided, on the basis of performance in the past 12 months, into three equally weighted groups (high, middle and low) and then observed for next 12 months. After that, groups are again rebalanced according to their performance. This study uses a panel regression model for analysis.

Findings

Chinese equity funds are successful in providing higher than market returns, and fund managers possess positive market timing ability. The authors find that Chinese equity funds do not show persistence in performance as witnessed in developed markets. Well-performing funds (worst funds) of last year do not continue to provide higher (lower) return in the following year. Moreover, the authors detect positive relationship of fund size, age and expense ratio with the fund’s performance. Overall results suggest that emerging market equity funds show better performance than that of developed markets.

Practical implications

Investors are better off if they invest in equity funds instead of index funds, as results illustrate that equity funds outperformed the market. Further, the strategy of buying well-performing funds of last year and selling poorly performing funds of last year does not look very attractive in China. This study helps investors to understand the Chinese managed funds industry, and such an understanding is also helpful for fund managers and asset management companies who use performance information in marketing strategies.

Originality/value

This is the first study to investigate the performance persistence in Chinese equity funds and also contributes to the literature about the performance and market timing ability of equity funds. The study takes the sample of 520 equity funds for the period from 2004 to 2014, which includes a period of financial crisis of 2008.

Details

Journal of Asia Business Studies, vol. 11 no. 2
Type: Research Article
ISSN: 1558-7894

Keywords

Article
Publication date: 22 April 2003

Ed Edwards and Ajay Samant

This study evaluates risk‐adjusted performance of socially responsible mutual funds during the period 1991‐2000, using objective statistical measures grounded in modern portfolio…

Abstract

This study evaluates risk‐adjusted performance of socially responsible mutual funds during the period 1991‐2000, using objective statistical measures grounded in modern portfolio theory. A socially responsible mutual fund is defined as one which employs “social screens” in stock selection, such as whether a fi rm manufactures tobacco products, whether it is in the gambling business, whether it heeds environmental safety, its human rights records, etc. The main objective of this study is to provide empirical documentation on the risk‐adjusted returns of these mutual funds, for the benefit of investors. To our knowledge, this is one of the first, if not the first, academic study to utilize a relatively new risk‐adjusted performance measure, posited by Nobel Laureate Franco Modigliani and Leah Modigliani in 1997 (hereafter referred to as M Squared), to evaluate socially responsible mutual funds. The idea that underlies their methodology is to adjust the investment risk of a mutual fund to the level of risk in an unmanaged benchmark stock‐market index and then measure the returns on the risk‐matched fund. The M Squared measure not only relates the level of risk to the level of reward, but also enables risk‐adjusted returns to be reported on a percentage basis, rather than on an absolute basis, which makes them more easily understood by the average investor. The results of this study can be used in decision making by investors who seek objective criteria to select a socially responsible mutual fund from among a menu of several funds.

Details

American Journal of Business, vol. 18 no. 1
Type: Research Article
ISSN: 1935-5181

Keywords

Article
Publication date: 12 November 2018

Ann-Ngoc Nguyen, Muhammad Sadiq Shahid and David Kernohan

The purpose of this paper is to investigate the impact of investor confidence on mutual fund performance in two relatively vulnerable but leading emerging markets, India and…

1379

Abstract

Purpose

The purpose of this paper is to investigate the impact of investor confidence on mutual fund performance in two relatively vulnerable but leading emerging markets, India and Pakistan.

Design/methodology/approach

A pooled ordinary least squared (OLS) model is used to look at two alternative measures of investor confidence and test for the relationship between investor confidence and mutual fund returns. To check the robustness of the findings, the authors also implement two-stage least squares and generalized method of moments techniques to control for unobserved heterogeneity, simultaneity and dynamic endogeneity problems in the regressors.

Findings

The paper finds that the returns of mutual funds are positively associated with investor confidence and an interaction effect exists between investor confidence and persistence in performance. The paper also confirms that returns from mutual funds are associated with different fund characteristics such as fund size, turnover, expense, liquidity, performance persistence and the fund’s age. These findings remain robust to alternative model specifications and measures of investor confidence.

Originality/value

While the previous literature mainly focuses on mutual fund characteristics and the macroeconomic determinants of mutual fund returns, this paper demonstrates that investor confidence plays an important role in determining mutual fund performance. The authors attribute this finding to two relatively unique features of the emerging markets in the study. A lack of awareness of mutual funds as being a low-cost investment vehicle and the interplay of cultural and behavioral changes have prevented investor’s savings from being channeled into investment products, away from gold or property.

Details

Journal of Economic Studies, vol. 45 no. 6
Type: Research Article
ISSN: 0144-3585

Keywords

11 – 20 of over 29000