Purchase and redemption decisions of mutual fund investors and the role of fund families
AbstractThis paper investigates the purchases and redemptions of a large cross-sectional sample of German equity funds. We find that investors punish bad performance by selling their shares, but also have a tendency to sell winners. Investors in large fund families show higher sales and redemption rates. Furthermore, family size also affects the flow-performance relationship. On the one hand, investors in large families punish bad performance more, on the other, they also tend to sell winners more. Finally, we find that inner-family rankings play an important role for redemptions, with investors strongly redeeming their shares from intra-family losers. --
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Bibliographic InfoPaper provided by Deutsche Bundesbank, Research Centre in its series Discussion Paper Series 2: Banking and Financial Studies with number 2010,03.
Date of creation: 2010
Date of revision:
Mutual funds; fund family; flow-performance relationship;
Other versions of this item:
- Stephan Jank & Michael Wedow, 2013. "Purchase and redemption decisions of mutual fund investors and the role of fund families," The European Journal of Finance, Taylor & Francis Journals, Taylor & Francis Journals, vol. 19(2), pages 127-144, February.
- Jank, Stephan & Wedow, Michael, 2010. "Purchase and redemption decisions of mutual fund investors and the role of fund families," CFR Working Papers, University of Cologne, Centre for Financial Research (CFR) 10-13, University of Cologne, Centre for Financial Research (CFR).
- G20 - Financial Economics - - Financial Institutions and Services - - - General
- G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
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- Dötz, Niko & Weth, Mark, 2013. "Cash holdings of German open-end equity funds: Does ownership matter?," Discussion Papers, Deutsche Bundesbank, Research Centre 47/2013, Deutsche Bundesbank, Research Centre.
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