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What Do We Know About the Mutual Fund Industry?

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Abstract

The Holy Grail in mutual funds literature has always been the analysis of performance. The literature has searched for answers to whether funds generate performance, whether they persist in doing so and whether it is enough to compensate for the fees that are charged. The answers have been mostly negative. Thus, a new question arises: if performance is not sizable and not persistent, what helps to justify the existence of the industry? The answer we will give in the following analysis is ‘marketing’. We will see how marketing strategies help to disguise poor performance and attract clients by focusing on non-performance-related features.

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Author information

Authors and Affiliations

  1. INSEAD, France

    Massimo Massa (Rothschild Chair Professor of Banking and Finance)

Authors
  1. Massimo Massa
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Editor information

Editors and Affiliations

  1. Department of Information, Operations and Management Sciences at the Stern School of Business, New York University, USA

    Michael Pinedo (Julius Schlesinger Professor of Operations Management and Chair) (Julius Schlesinger Professor of Operations Management and Chair)

  2. New York University Stern School of Business, USA

    Ingo Walter (President of SimCorpStrategyLab and the Seymour Milstein Professor of Finance, Corporate Governance and Ethics) (President of SimCorpStrategyLab and the Seymour Milstein Professor of Finance, Corporate Governance and Ethics)

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© 2013 SimCorp StrategyLab

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Massa, M. (2013). What Do We Know About the Mutual Fund Industry?. In: Pinedo, M., Walter, I. (eds) Global Asset Management. Palgrave Macmillan, London. https://doi.org/10.1057/9781137328878_2

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