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Evolution of a mutual fund market: Empirical analysis of simultaneous growth and decline by fund category in Indonesia

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  • Narulita, Wista A.
  • Parwada, Jerry T.
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    Abstract

    The mutual fund literature traditionally deals with the growth and decline of the funds management industry in a uni-dimensional, single equation framework. Numerous studies treat mutual fund starts, terminations, inflows, and outflows as independent phenomena. This paper investigates the role of the interdependence between mutual fund inflows and outflows and their determinants in the growth of the emerging Indonesian managed funds market. We find significant replacement and displacement effects between the outflows and inflows of fixed income, equity, and mixed funds. The evidence suggests studies of the development of mutual fund markets should take into account simultaneity between the expansion and declining of different fund categories.

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    Bibliographic Info

    Article provided by Elsevier in its journal Journal of International Financial Markets, Institutions and Money.

    Volume (Year): 22 (2012)
    Issue (Month): 5 ()
    Pages: 1217-1236

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    Handle: RePEc:eee:intfin:v:22:y:2012:i:5:p:1217-1236

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    Web page: http://www.elsevier.com/locate/intfin

    Related research

    Keywords: Mutual fund; Emerging market; Simultaneous growth; Evolution;

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    References

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