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Success and failure on the corporate bond fund market

Author

Listed:
  • Martin Rohleder

    (University of Augsburg)

  • Hendrik Scholz

    (Friedrich-Alexander-Universität (FAU) Erlangen-Nürnberg)

  • Marco Wilkens

    (University of Augsburg)

Abstract

We present the first broad overview of the factors determining corporate bond fund success and failure in terms of performance and survival. We show that the main determinant of survival is size. Performance matters only for small funds while large funds survive unconditionally, consistent with maintaining fee revenues. We neither find persistence in performance nor diseconomies of scale. This is due to advantages of larger funds in corporate bond trading. Other fund and family characteristics are unrelated to performance and survival, contrasting previous finings in equity funds. Thus, there are similarities but also important differences between the factors determining success and failure on the corporate bond and equity fund markets.

Suggested Citation

  • Martin Rohleder & Hendrik Scholz & Marco Wilkens, 2018. "Success and failure on the corporate bond fund market," Journal of Asset Management, Palgrave Macmillan, vol. 19(6), pages 429-443, October.
    • Handle: RePEc:pal:assmgt:v:19:y:2018:i:6:d:10.1057_s41260-018-0086-7
    DOI: 10.1057/s41260-018-0086-7
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    More about this item

    Keywords

    Corporate bond funds; Performance; Disappearance and survival; Fund size;
    All these keywords.

    JEL classification:

    • G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates

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