The ABCs of mutual funds: On the introduction of multiple share classes

Journal of Financial Intermediation

Volumn 18, Issue 3, 2009, Pages 329-361

  Nanda, Vikram K ^a   Wang, Z Jay ^b   Zheng, Lu ^c  

^a GEORGIA INSTITUTE OF TECHNOLOGY   (United States)

^b UNIVERSITY OF ILLINOIS AT URBANA CHAMPAIGN   (United States)

^c UNIVERSITY OF CALIFORNIA   (United States)

Author keywords

Distribution channels; Fund flows; Fund performance; Investor clienteles; Mutual funds

Indexed keywords

EID: 67349100508     PISSN: 10429573     EISSN: 10960473     Source Type: Journal    
DOI: 10.1016/j.jfi.2008.12.003     Document Type: Article

References (46)

1. Allen F., and Gale D. Optimal security design. Rev. Finan. Stud. 1 3 (1988) 229-263
2. Amihud Y., and Mendelson H. Asset pricing and the bid-ask spread. J. Finan. Econ. 17 (1986) 223-249
3. Aragon G. Share restriction and asset pricing: Evidence from the hedge fund industry. J. Finan. Econ. 83 (2007) 33-58
4. Barber B.M., Odean T., and Zheng L. Out of sight, out of mind: The effects of expenses on mutual fund flows. J. Bus. 78 6 (2005) 2095-2119
5. Bergstresser D.B., and Poterba J. Do after-tax returns affect mutual fund inflows?. J. Finan. Econ. 63 (2002) 381-414
6. Berk J., and Green R.C. Mutual fund flows and performance in rational markets. J. Polit. Economy 112 (2004) 1269-1295
7. Blake C.R., Elton E.J., and Gruber M.J. The performance of bond mutual funds. J. Bus. 66 3 (1993) 371-403
8. Bollen N., and Busse J. Short-term persistence in mutual fund performance. Rev. Finan. Stud. 18 (2005) 569-597
9. Boudoukh J., Richardson M., Subrahmanyam M., and Whitelaw R. Stale prices and strategies for trading mutual funds. Finan. Analyst J. 58 4 (2002) 53-71
10. Brown S.J., and Goetzmann W.N. Performance persistence. J. Finance 50 (1995) 679-698
11. Carhart M.M. On persistence in mutual fund performance. J. Finance 52 (1997) 57-82
12. Chen J., Hong H., Huang M., and Kubik J. Does fund size erode mutual fund performance? The role of liquidity and organization. Amer. Econ. Rev. 94 5 (2004) 1276-1302
13. Chevalier J., and Ellison G. Risk taking by mutual funds as a response to incentives. J. Polit. Economy 105 (1997) 1167-1200
14. Chordia T. The structure of mutual fund charges. J. Finan. Econ. 41 (1996) 3-39
15. Coval J., and Stafford E. Asset fire sales (and purchases) in equity markets. J. Finan. Econ. 86 (2007) 479-512
16. Cronqvist, Henrik, 2003. Advertising and portfolio choice. Unpublished manuscript, Ohio State University
17. Del Guercio, Diane, Tkac, Paula A., 2002. Star power: The effect of Morningstar ratings on mutual fund flows. Unpublished manuscript, Federal Reserve Bank of Atlanta
18. Edelen R. Investor flows and the assessed performance of open-end mutual funds. J. Finan. Econ. 53 (1999) 439-466
19. Elton E.J., Gruber M.J., and Blake C.R. The persistence of risk-adjusted mutual fund performance. J. Bus. 69 (1996) 133-157
20. Fama E.F., and French K.R. Common risk factors in returns on stocks and bonds. J. Finan. Econ. 33 (1993) 3-56
21. Fama E., and MacBeth J. Risk, return, and equilibrium: Empirical tests. J. Polit. Economy 81 (1973) 607-636
22. Gallaher, Steven, Kaniel, Ron, Starks, Laura, 2004. Madison Avenue meets Wall Street: Mutual fund families, competition, and advertising. Unpublished manuscript, University of Texas at Austin
23. Goetzmann W.N., and Ibbotson R.G. Do winners repeat? Patterns in mutual fund performance. J. Portfol. Manage. 20 (1994) 9-17
24. Goetzmann W.N., and Peles N. Cognitive dissonance and mutual fund investors. J. Finan. Res. 20 (1997) 145-158
25. Goetzmann W., Ivkovic Z., and Rouwenhorst G. Day trading international mutual funds: Evidence and policy solutions. J. Finan. Quant. Anal. 36 (2001) 287-309
26. Gruber M.J. Another puzzle: The growth in actively managed mutual funds. J. Finance 51 (1996) 783-810
27. Hortaçsu A., and Syverson C. Search costs, product differentiation, and the welfare effects of entry: A case study of S&P 500 index funds. Quart. J. Econ. 119 4 (2004) 403-456
28. Jain P.C., and Wu J.S. Truth in mutual fund advertising: Evidence on future performance and fund flows. J. Finance 55 (2000) 937-958
29. Johnson W.T. Predictable investment horizons and wealth transfers among mutual fund shareholders. J. Finance 59 (2004) 1979-2012
30. Johnson, Woodrow T., 2007. Who monitors the mutual fund manager, new or old shareholders? Unpublished manuscript, University of Oregon
31. Lesseig V.P., Long D.M., and Smythe T.I. Gains to mutual fund sponsors offering multiple share class funds. J. Finan. Res. 25 1 (2002) 81-98
32. Livingston M., and O'Neal E.S. The cost of mutual fund distribution fees. J. Finan. Res. 21 2 (1998) 205-218
33. Malkiel Burton.G. Returns from investing in equity mutual funds 1971 to 1991. J. Finance 50 2 (1995) 549-572
34. Massa M. How do family strategies affect fund performance? When performance-maximization is not the only game in town. J. Finan. Econ. 67 2 (2003) 249-304
35. Nanda V., Narayanan M.P., and Warther V. Liquidity, investment ability, and mutual fund structure. J. Finan. Econ. 57 (2000) 417-443
36. Nanda V., Wang Z.J., and Zheng L. Family values and the star phenomenon. Rev. Finan. Stud. 17 3 (2004) 667-698
37. O'Neal E. Mutual fund share classes and broker incentives. Finan. Analyst J. 55 (1999) 76-87 (September/October)
38. Rakowski, David, 2002. Fund flow volatility and performance. Working paper, Georgia State University
39. Reid, Brian K., Rea, John D., 2003. Mutual fund distribution channels and distribution costs. Perspectives (Investment Company Institute) 9 (3)
40. Reuter J., and Zitzewitz E. Do ads tempt editors? Advertising and bias in the financial media. Quart. J. Econ. 121 (2006) 197-227
41. Sirri E.R., and Tufano P. Costly search and mutual fund flows. J. Finance 53 (1998) 1589-1622
42. Stein, Jeremy C., 2003. Why are most funds open-end? Competition and the limits of arbitrage. Unpublished manuscript, Harvard University and NBER
43. Tufano P. Financial innovation and first-mover advantages. J. Finan. Econ. 25 (1989) 213-240
44. Wilcox R.T. Bargain hunting or star gazing? How consumers choose mutual funds, forthcoming. J. Bus. 76 (2003) 645-664
45. Zheng L. Is money smart? A study of mutual fund investors' fund selection ability. J. Finance 54 (1999) 901-933
46. Zitzewitz E. Who cares about shareholders? Arbitrage-proofing mutual funds. J. Law Econ. Organ. 19 2 (2003) 245-280