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Australian equity mutual fund size effects
Author(s) -
Heaney Richard
Publication year - 2008
Publication title -
accounting and finance
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.645
H-Index - 49
eISSN - 1467-629X
pISSN - 0810-5391
DOI - 10.1111/j.1467-629x.2008.00267.x
Subject(s) - mutual fund , equity (law) , business , fund administration , investment fund , private equity fund , finance , income fund , closed end fund , index fund , cash flow , manager of managers fund , target date fund , open end fund , investment management , institutional investor , private equity , corporate governance , political science , market liquidity , law
Berk and Green propose a model of a superannuation fund industry, with a limited population of superior fund managers and a competitive investor market. In this market, superior fund managers capture the value they generate, leaving investors with a normal return on their investment. Furthermore, it is argued that previous period returns, age of the fund and management costs explain variation in net cash flow paid into a fund over time. The Berk and Green predictions find some support in empirical tests, reported in the present paper, based on Australian Morningstar retail and wholesale equity fund data over the period 1995–2005.