Mutual Fund Tournaments and Fund Active Share

C Wei Li; Ashish Tiwari; Lin Tong

doi:10.1016/j.jfs.2022.101083

Back

Mutual Fund Tournaments and Fund Active Share

Journal article

Peer reviewed

Mutual Fund Tournaments and Fund Active Share

C Wei Li, Ashish Tiwari and Lin Tong

Journal of financial stability, Vol.63, 101083

12/01/2022

DOI: 10.1016/j.jfs.2022.101083

View Online

Abstract

We study the impact of the tournament-like competition in the mutual fund industry by examining the Active Share choices of funds. Funds with relatively poor performance by the end of the third quarter in a calendar year tend to increase their Active Share during the last quarter. The increase in the trailing funds’ Active Share is accompanied by an increase in the funds’ downside risk exposure. The evidence suggests that the strategic shifts in Active Share we document are not information/skill motivated.

Asymmetric and Private Information, Mechanism Design (D82)

Information

Mutual Fund

Pension Funds, Non-bank Financial Institutions, Financial Instruments, Institutional Investors (G23)

Tournament

Details

Title: Subtitle: Mutual Fund Tournaments and Fund Active Share
Creators: C Wei Li - University of Iowa
Ashish Tiwari - University of Iowa
Lin Tong - Fordham University
Resource Type: Journal article
Publication Details: Journal of financial stability, Vol.63, 101083
DOI: 10.1016/j.jfs.2022.101083
ISSN: 1572-3089
eISSN: 1878-0962
Language: English
Date published: 12/01/2022
Academic Unit: Finance
Record Identifier: 9984380521902771

Metrics

9 Record Views

2 Times Cited - Web of Science