Event Title

An Evaluation of the Impact that Distribution Channels Have on Mutual Fund Flows

College

College of Business Administration

Department

Department of Accounting, Finance, and Economics

Honors Thesis Committee

Philip Gibson, Ph.D.; Yuanshan Cheng, Ph.D.; and Charles Alvis, M.B.A.

Location

DIGS 114

Start Date

20-4-2018 2:45 PM

Description

The efficient market hypothesis (EMH) states that an efficient market will price securities appropriately because they reflect all available and relevant information. In saying this, the investment theory suggests that investors are rational and will seek investments that will provide the highest return for a given level of risk – however, this is not always the case. In reality, investors lack the financial sophistication to properly evaluate the various securities that are offered in the financial market. This study evaluates information asymmetry within mutual fund distribution channels, to examine the concept of mutual fund managers, brokers, and financial advisers being incentivized for specific transactions. In a situation where there is asymmetric information, there is an opportunity for the more knowledgeable party to take advantage of the less knowledgeable. In assessing investor behavior, this thesis presents flow findings from U.S. equity mutual funds within various distribution channels, particularly during times of volatility. The analysis will compare their funds’ relative returns against the performance of the market and yield results for investor behavior.

This document is currently not available here.

Share

COinS
 
Apr 20th, 2:45 PM

An Evaluation of the Impact that Distribution Channels Have on Mutual Fund Flows

DIGS 114

The efficient market hypothesis (EMH) states that an efficient market will price securities appropriately because they reflect all available and relevant information. In saying this, the investment theory suggests that investors are rational and will seek investments that will provide the highest return for a given level of risk – however, this is not always the case. In reality, investors lack the financial sophistication to properly evaluate the various securities that are offered in the financial market. This study evaluates information asymmetry within mutual fund distribution channels, to examine the concept of mutual fund managers, brokers, and financial advisers being incentivized for specific transactions. In a situation where there is asymmetric information, there is an opportunity for the more knowledgeable party to take advantage of the less knowledgeable. In assessing investor behavior, this thesis presents flow findings from U.S. equity mutual funds within various distribution channels, particularly during times of volatility. The analysis will compare their funds’ relative returns against the performance of the market and yield results for investor behavior.