The value of active mutual fund management: An examination of the stockholdings and trades of fund managers (2000)
| Venue: | Journal of Financial and Quantitative Analysis |
| Citations: | 35 - 4 self |
BibTeX
@ARTICLE{Chen00thevalue,
author = {Hsiu-lang Chen and Narasimhan Jegadeesh and Russ Wermers},
title = {The value of active mutual fund management: An examination of the stockholdings and trades of fund managers},
journal = {Journal of Financial and Quantitative Analysis},
year = {2000},
pages = {343--368}
}
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Abstract
We investigate the value of active mutual fund management by examining the stockholdings and trades of mutual funds. We find that stocks widely held by funds do not outperform other stocks. However, stocks purchased by funds have significantly higher returns than stocks that are sold—this is true for large stocks as well as small stocks, and for value stocks as well as growth stocks. Moreover, growth-oriented funds exhibit better stockselection skills than income-oriented funds, especially in picking large growth stocks. Finally, funds trading more frequently have, at best, marginally better stock-selection skills than funds that trade less often. The Value of Active Mutual Fund Management: An Examination of the Stockholdings and Trades of Fund Managers I.
