scholarly journals Investor behavior and the demand for conventional and socially responsible mutual funds

2021 ◽  
Author(s):  
Juan Carlos Matallín‐Sáez ◽  
Amparo Soler‐Domínguez ◽  
Salvador Navarro‐Montoliu ◽  
Diego Víctor de Mingo‐López
Keyword(s):  
Mutual Funds ◽  
Investor Behavior ◽  
Socially Responsible ◽  
Socially Responsible Mutual Funds

Mutual Fund Attributes and Investor Behavior

2007 ◽  
Vol 42 (3) ◽  
pp. 683-708 ◽  
Author(s):  
Nicolas P. B. Bollen
Keyword(s):  
Mutual Funds ◽  
Strong Evidence ◽  
Mutual Fund ◽  
Cash Flows ◽  
Investor Behavior ◽  
Anecdotal Evidence ◽  
Socially Responsible ◽  
Socially Responsible Mutual Funds

AbstractI study the dynamics of investor cash flows in socially responsible mutual funds. Consistent with anecdotal evidence of loyalty, the monthly volatility of investor cash flows is lower in socially responsible funds than in conventional funds. I find strong evidence that cash flows into socially responsible funds are more sensitive to lagged positive returns than cash flows into conventional funds, and weaker evidence that cash outflows from socially responsible funds are less sensitive to lagged negative returns. These results indicate that investors derive utility from the socially responsible attribute, especially when returns are positive.

Looking for sustainable development: Socially responsible mutual funds and the low‐carbon economy

2020 ◽  
Author(s):  
Amparo Soler‐Domínguez ◽  
Juan Carlos Matallín‐Sáez ◽  
Diego Víctor Mingo‐López ◽  
Emili Tortosa‐Ausina
Keyword(s):  
Sustainable Development ◽  
Mutual Funds ◽  
Low Carbon ◽  
Socially Responsible ◽  
Low Carbon Economy ◽  
Socially Responsible Mutual Funds ◽  
Carbon Economy

Style-changing behaviour in the socially responsible mutual fund industry: consequences on financial and sustainable performance

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Fernando Muñoz ◽  
María Vargas ◽  
Ruth Vicente
Keyword(s):  
Mutual Funds ◽  
Mutual Fund ◽  
Fixed Effects ◽  
Socially Responsible ◽  
Content Type ◽  
Sustainable Performance ◽  
Panel Regressions ◽  
Money Flows ◽  
Socially Responsible Mutual Funds ◽  
Performance Ranking

Purpose This study aims to examine style-deviation practices in the socially responsible mutual funds (SMRF) industry i.e. how mutual funds game their stated financial objectives to earn a higher relative performance ranking. In addition, the consequences of such practices on sustainable scores and money flows are studied. Design/methodology/approach A sample of 454 US equity SRMFs is studied. This paper uses panel regressions controlling for time and style fixed-effects. Findings This study finds that 17.60% of SRMF managers in the sample are engaged in style deviation practices. These practices positively impact the sustainable performance of SRMFs and negatively impact their financial performance. One effect offsets the other and they consequently do not affect money flows. Another finding is that only investors with lower portfolio sustainability scores do show return-chaser behaviour. Practical implications This paper reveals that SRMF managers deviating from their stated financial style face a dilemma that is non-existent for their conventional peers that is style deviation practices affect financial and sustainable performance in opposing ways, whereas SRMF investor utility depends positively on both dimensions. The findings are not conclusive about the effectiveness of style deviation practices in attracting SRMF money flows. Social implications SRMF industry has experienced tremendous growth in the past decade. The increased competition in this industry has led managers to strive to attract investors, sometimes by relying on irregular practices that enhance their portfolio results. Regulators should consider how to avoid such perverse behaviour with a view to improving mutual funds transparency. Originality/value This is the first research that analyses style deviation practices and their consequences for the SRMF industry.

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