Mutual fund industry management structure, risk and the impacts to shareholders

This article investigates the effects of a multiple fund management structure on the risk volatility of the funds simultaneously managed. Using a sample of 1480 mutual funds managed by 407 fund managers over a 3-year period, we find that the risk volatility of at least one fund managed by a multiple fund manager is significantly higher than its objective and risk-adjusted peers. At the same time, the other funds concurrently managed display significantly less difference in risk volatility. Similarly, the return-to-risk ratio of multiple fund managers is not consistently greater than the unitary managed funds.