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Financial Investments in Romania. A Comparative Analysis between Open-end Mutual Funds and Bank Deposits

Author

Listed:
  • Pop Izabela Luiza

    (Technical University of Cluj-Napoca)

  • Hordău Anne Marie

    (Technical University of Cluj-Napoca)

Abstract

Despite the failures that investment funds have registered in Romania by the year 2000, they are a financial instrument chosen by more and more people to capitalize on their savings. Therefore, open-end investment funds have had a steady growth trend in Romania over the past 10 years; their net asset value increased by 24 times and the number of investors tripled. In this context, the purpose of our paper is to present possible factors that have caused this increase. Particularly, the empirical research focuses on studying the links that might exist between open-end investment funds, bank deposits and interest rates on bank deposits. The correlations between these variables were analysed by computing the Pearson's correlation coefficient. The results highlight a high negative relationship that exist between net asset value of investment funds and bank interest. Nevertheless, it has been found that bank deposits are related neither to the interest rate nor to the open-end investment funds.

Suggested Citation

  • Pop Izabela Luiza & Hordău Anne Marie, 2017. "Financial Investments in Romania. A Comparative Analysis between Open-end Mutual Funds and Bank Deposits," Ovidius University Annals, Economic Sciences Series, Ovidius University of Constantza, Faculty of Economic Sciences, vol. 0(2), pages 620-626, December.
    • Handle: RePEc:ovi:oviste:v:xvii:y:2017:i:2:p:620-626
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    References listed on IDEAS

    as
    1. Sergey Chernenko & Josh Lerner & Yao Zeng, 2021. "Mutual Funds as Venture Capitalists? Evidence from Unicorns [The role of boards of directors in corporate governance: a conceptual framework and survey]," The Review of Financial Studies, Society for Financial Studies, vol. 34(5), pages 2362-2410.
    2. Sergey Chernenko & Josh Lerner & Yao Zeng & Francesca Cornelli, 0. "Mutual Funds as Venture Capitalists? Evidence from Unicorns," Review of Financial Studies, Society for Financial Studies, vol. 34(5), pages 2362-2410.
    3. Kedong YIN & Xuemei LI & Bohong LI & Fan ZHANG, 2017. "Shock Effects from International Stock Price Volatility on Investment Style Drift in Chinese Open-end Funds," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(2), pages 62-78, June.
    4. Martin Rohleder & Dominik Schulte & Marco Wilkens, 2017. "Management of flow risk in mutual funds," Review of Quantitative Finance and Accounting, Springer, vol. 48(1), pages 31-56, January.
    5. Fabrizio Crespi, 2017. "Using Open-End Mutual Fund Resources to Finance SMEs: The Potential Market Share of ELTIFs," Palgrave Macmillan Studies in Banking and Financial Institutions, in: Stefania Rossi (ed.), Access to Bank Credit and SME Financing, chapter 11, pages 287-311, Palgrave Macmillan.
    6. Diana COZMA IGHIAN, 2012. "A Study on Accounting Standards with Regards to Financial Instruments," Economics and Applied Informatics, "Dunarea de Jos" University of Galati, Faculty of Economics and Business Administration, issue 1, pages 69-76.
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    More about this item

    Keywords

    return of investment; interest rate; open-end mutual fund; retail investors; bank deposits;
    All these keywords.

    JEL classification:

    • E21 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Consumption; Saving; Wealth
    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E43 - Macroeconomics and Monetary Economics - - Money and Interest Rates - - - Interest Rates: Determination, Term Structure, and Effects

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