The Predictability of Managerial Heterogeneities in Mutual Funds

Using a sample of Chinese mutual funds, we empirically assess how managerial heterogeneity affects mutual fund performance. We find that funds with higher manager fixed effects outperform those with lower manager fixed effects by 2% per year. We also note that fund performance improves after manager...

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Published in:Financial management 2015-12, Vol.44 (4), p.947-979
Main Authors: Huang, Jun, Wang, Albert Y.
Format: Article
Language:English
Subjects:
Analysis
Management
Mutual fund managers
Mutual funds
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description Using a sample of Chinese mutual funds, we empirically assess how managerial heterogeneity affects mutual fund performance. We find that funds with higher manager fixed effects outperform those with lower manager fixed effects by 2% per year. We also note that fund performance improves after managers with higher fixed effects are hired. The results are consistent with the notion that manager fixed effects are associated with managerial innate ability. Finally, we find that investors pay attention to managerial attributes beyond the traditional performance measures, providing supporting evidence for the rational explanation of convex flow-performance sensitivity in the literature.
doi_str_mv 10.1111/fima.12075
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source EconLit s plnými texty; EBSCOhost Business Source Ultimate; JSTOR Archival Journals and Primary Sources Collection; Wiley-Blackwell Read & Publish Collection
subjects Analysis
Management
Mutual fund managers
Mutual funds
title The Predictability of Managerial Heterogeneities in Mutual Funds
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