The worldwide impact of institutional funds on flow-performance relationship

• Autor(a) principal: Dan Su
• Data de Publicação: 2017
• Tipo de documento: Dissertação
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10071/18262
• topic: Mutual funds; Flow-performance relationship; Convexity; institutional investors; Investor sophistication; Finanças; Fundos de investimento; Fluxos monetários; Investidores; Análise comparativa; País; Estados Unidos da América

This thesis uses data from 15 countries, over the 1998-2010 period, to examine and compare differences in the flow-performance sensitivity between institutional and retail investors. Our results show that the flow-performance relationship is convex, consistent with previous research, but the impact of institutional funds on flow-performance relationship outside the US is marked different from the US. Compared to retail investors, institutional funds sell more poor performance funds and buy less top performance funds outside the US while institutional investor act the same way as retail investors to past performance in the US. We then split our sample into more and less sophisticated countries, investors buy more top performers but only in less sophisticated countries. When it comes to bottom performance, the reactions are similar for both more sophisticated and less sophisticated countries. Our finds provide evidence that institutional investors are more sophisticated than retail investors in less sophisticated countries and retail investors are sophisticated as institutional investors in more sophisticated countries, like the US.