Mutual fund structure and performance

• Autores: Rafael Zambrana Galacho
• Directores de la Tesis: Jesús David Moreno Muñoz (dir. tes.), Rosa Rodríguez López (dir. tes.)
• Lectura: En la Universidad Carlos III de Madrid ( España ) en 2015
• Idioma: inglés
• Tribunal Calificador de la Tesis: Andrés Almazán (presid.), Pablo Ruiz-Verdú (secret.), Miguel Ferreira (voc.)
• Materias:
  • Ciencias económicas
    • Economía internacional
      • Financiación internacional
• Enlaces
  • Tesis en acceso abierto en: e-Archivo
• Resumen

  • Sub-advising contracts have grown considerably during recent decades despite the agency issues identified by prior literature. In the first chapter, I find that the market provides several contractual arrangements such as co-branding, multi-advisory arrangements and performance fees that management companies can use to protect their more informed investors from poor management by these sub-advising firms. Additionally, I show that fund families that have outsourced some of their portfolios tend to have greater market share, especially when a new investment style is launched. The second chapter empirically analyzes the role of investment companies’ core competencies in explaining the growing importance of outsourcing within the mutual fund industry. We demonstrate that management companies allocate portfolios that are not within their core competencies to sub-advisors whose core competency coincides with the outsourced mutual fund. We investigate the efficiency of such decisions in terms of performance, and the findings suggest that selecting a sub-advisor according to core competency improves mutual fund performance. In the third chapter, I examine whether individual management leads to better performance than team approach when managers face greater coordination cost. SRI funds provide an ideal empirical setting for testing this, as these funds implement strict social criteria. We show that SRI funds are better managed under an individual management structure independently of the specific fund and family characteristics. This performance increases for SRI funds with highly levels of social screenings since individual management leads to sharpen information processing and decision-making.