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Bond Mutual Funds vs. Bond Exchange Traded Funds: Evaluation of Risk Adjusted Performance

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  • Jelena Stankevičienė

    (Department of Financial Engineering, Vilnius Gediminas Technical University, LT-10223 Vilnius, Lithuania)

  • Ieva Petronienė

    (Department of Financial Engineering, Vilnius Gediminas Technical University, LT-10223 Vilnius, Lithuania)

Abstract

Growing acceptance of passive bond exchange traded funds (ETFs) and actively managed bond mutual funds has exposed the need to find a divide between these two comparatively similar types of instrument. This paper provides a comparative analysis of actively managed bond funds and passive bond ETFs in the context of multiple criteria. The research of risk-adjusted performance of a sampled group of bond funds and ETFs using the TOPSIS multi-criteria decision-making method revealed that actively managed bond funds have a modest advantage over passive bond ETFs. Moreover, the final findings indicate the funds’ performance dependability on portfolio composition by fixed income sector.

Suggested Citation

  • Jelena Stankevičienė & Ieva Petronienė, 2019. "Bond Mutual Funds vs. Bond Exchange Traded Funds: Evaluation of Risk Adjusted Performance," Administrative Sciences, MDPI, vol. 9(2), pages 1-14, April.
    • Handle: RePEc:gam:jadmsc:v:9:y:2019:i:2:p:31-:d:219319
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    References listed on IDEAS

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    Cited by:

    1. Marszk, Adam & Lechman, Ewa, 2021. "Reshaping financial systems: The role of ICT in the diffusion of financial innovations – Recent evidence from European countries," Technological Forecasting and Social Change, Elsevier, vol. 167(C).

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