The Impact of Mutual Fund Ownership on Corporate Investment: Evidence from a Natural Experiment

Author(s):  
Roni Kisin
2018 ◽  
Vol 53 (1) ◽  
pp. 171-201 ◽  
Author(s):  
Xiaoxia Lou ◽  
Albert Y. Wang

The impact of liquidity-motivated institutional trading on firms’ real decisions is not confined to periods of financial crisis. Firms subject to mutual fund flow-driven selling pressure reduce share issuance and investment, whereas firms experiencing buying pressure do not increase investment, although they issue more equity. Firms under extreme selling pressure cut quarterly investment by 0.075 percentage points of total assets, which is 4.3% of the average quarterly investment in our sample. We also find evidence that the effect is not attributed to managerial learning or catering incentives. Rather, flow-driven trading affects investment mainly through its impact on the financing cost.


CFA Digest ◽  
1999 ◽  
Vol 29 (4) ◽  
pp. 48-49
Author(s):  
H. Kent Baker
Keyword(s):  

2017 ◽  
Author(s):  
Irina Bezhentseva Mateus ◽  
Cesario Mateus ◽  
Natasa Todorovic
Keyword(s):  

2016 ◽  
Vol 5 (2) ◽  
Author(s):  
Ratish C Gupta ◽  
Dr. Manish Mittal

The Indian mutual fund industry is one of the fastest growing and most competitive segments of the financial sector. The extent of under-penetration in the market is a sore point with the financial services industry, with a large amount of savings being channelized into fixed deposits, gold and real estate rather than the capital markets. The mutual fund industry is yet to spread its reach beyond Tier I cities. The top fifteen cities contribute to 85% of the pie, with the remaining 15% distributed among other cities. The study seeks to determine the impact of decision making of investors on current situation of mutual fund industry.


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