The determinants of mutual fund size: a cross-country analysis

• Autor(a) principal: Antunes, António Manuel Guedes
• Data de Publicação: 2007
• Tipo de documento: Dissertação
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10071/1437
• topic: Mutual funds; Fund size; Fund attributes; Country characteristics; Fundos de investimento; Dimensão dos fundos; Atributos dos fundos; Características dos países

This paper examines the relation between mutual fund size, fund attributes and country characteristics. Data on mutual funds is drawn from Lipper Hindsight, a database that covers mutual funds around the world. The sample includes 42,699 open-end funds from 18 countries in 2004. Individual fund size is measured in two different ways: using the relative weight of the industry and of the asset class. The results show that money market and real estate funds are usually larger while equity funds seem to be negatively related to size. There is strong evidence that primary funds, those complying UCITS rules and older funds are larger. Among the set of strategies adopted by a fund, results show that mutual funds investing in other funds (funds of funds external and internal) are smaller. Funds that invest in government bonds tend to be larger in the whole industry. Strikingly, we do not find statistical evidence that funds investing domestically are larger than those investing abroad. High annual and redemption charges impact mutual fund size negatively. The results on annual charges are stronger for the U.S. and equity mutual funds. Results on fixed effect factors enhance the importance of the country specificities explaining mutual fund size. Funds tend to be smaller in countries that are more economically developed (measured by GDPpc) and with more investor protection and better accounting standards. In order to test the robustness of the results we also split the sample into sub-samples: U.S. funds vs. non-U.S. funds and Equity Funds vs. Bond Funds.