Fund manager skill in an era of globalization: Offshore concentration and fund performance

Abstract In this study, I examine the risk-adjusted return of mutual funds in India. A data set of 4220 mutual funds is used for the analysis. Sharpe ratio, a metric of risk-adjusted return (Sharpe, 1994) and Information ratio, a metric of outperformance than a fund’s benchmark (Goodwin, 1998) were analyzed. Regression analysis is used to estimate the impact of fund characteristics like fund category, fund type, fund access type, corpus size on the dependent variables i.e., Sharpe Ratio and the Information Ratio. All the funds underperformed in both the Sharpe ratio and Information ratio. Liquid funds found worst. Fund type and corpus size do not impact fund performance. Fund access type was found to be significant on fund performance. The results add to the literature by examining the post-pandemic period.

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Are some fund managers better than others? Manager characteristics and fund performance

South African Journal of Business Management ◽

10.4102/sajbm.v35i3.660 ◽

2004 ◽

Vol 35 (3) ◽

pp. 31-40 ◽

Cited By ~ 4

Author(s):

L. B. Friis ◽

E. V.D.M. Smit

Keyword(s):

Risk Taking ◽

Fund Performance ◽

Management Team ◽

Team Size ◽

Fund Manager ◽

Independent Variables ◽

Fund Managers ◽

Qualification Management ◽

Better Than

The research objective has been to find out whether fund manager characteristics help explain fund performance and propensity to risk taking. Eight independent variables; manager age, tenure of the manager with the fund, years of education, whether the manager holds a MBA or CA/CFA qualification, management team size, fund age and fund objective are regressed on measures of fund performance and riskiness.The findings of the study are highly significant and show that fund performance and riskiness are impacted upon by managers’ qualifications. One can expect better risk-adjusted performance from a fund manager who holds a CA/CFA qualification. Results show that these managers outperform managers without these qualifications, while taking on less risk than managers with MBA qualifications.

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Volatility and mutual fund manager skill

Journal of Financial Economics ◽

10.1016/j.jfineco.2015.06.012 ◽

2015 ◽

Vol 118 (2) ◽

pp. 289-298 ◽

Cited By ~ 39

Author(s):

Bradford D. Jordan ◽

Timothy B. Riley

Keyword(s):

Mutual Fund ◽

Fund Manager ◽

Mutual Fund Manager ◽

Manager Skill

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Hedge Fund Performance and Manager Skill

Journal of Futures Markets ◽

10.1002/fut.2102 ◽

2001 ◽

Vol 21 (11) ◽

pp. 1003-1028 ◽

Cited By ~ 181

Author(s):

Franklin R. Edwards ◽

Mustafa Onur Caglayan

Keyword(s):

Hedge Fund ◽

Fund Performance ◽

Manager Skill ◽

Hedge Fund Performance

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Time-Varying Fund Manager Skill

CFA Digest ◽

10.2469/dig.v43.n4.85 ◽

2013 ◽

Vol 43 (4) ◽

Author(s):

Nicholas J. Handley

Keyword(s):

Time Varying ◽

Fund Manager ◽

Manager Skill

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Mutual fund manager turnover: an empirical investigation of performance

International Journal of Managerial Finance ◽

10.1108/ijmf-04-2021-0195 ◽

2021 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Avinash Ghalke ◽

Shripad Kulkarni

Keyword(s):

Mutual Fund ◽

Emerging Market ◽

Investment Strategy ◽

Fund Performance ◽

Fund Manager ◽

Content Type ◽

Fund Managers ◽

Fund Families ◽

Study Methodology ◽

Factor Alpha

PurposeWhen a fund manager leaves, the investment strategy of the fund changes or remains the same. The departing fund manager's resignation is either forced or voluntary. The study investigates the relationship between the portfolio manager's transition and the fund's investment strategy and how the change affects the mutual fund returns in the subsequent period.Design/methodology/approachThe authors examine 148 fund manager changes in India between April 2005–March 2018 using three performance measures: abnormal return (fund return minus benchmark return), Jensen's alpha and Carhart four-factor alpha. The analysis includes an event study methodology, followed by a two-step Fama–MacBeth regression approach.FindingsContrary to the previous studies conducted in the developed markets, the authors find that fund performance improves irrespective of whether the fund manager change is forced or voluntary. The outperformance after the fund manager's exit is significant for funds belonging to the larger fund families.Originality/valueIn the context of investment management, the authors provide a conceptual framework to understand the effect of fund manager exit on mutual fund performance. The authors substantiate their arguments with empirical evidence. To the best of the authors' understanding, this is the first research to examine the effect of changing mutual fund managers in an emerging market setting.

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