The controversy about whether mutual fund shareholders should invest primarily in actively managed funds or index funds continues. But, while there may be a small number of portfolio managers who provide evidence of persistency in high performance (assuming they meet the daunting statistical...

It is not enough to say that particular mutual funds have very excessive and most excessive expense ratios. In addition, these high cost funds are associated with negative portfolio characteristics that include more risky and less diversified portfolios, higher trading costs and lower earnings....

The Investment Company Act of 1940 states that the interests of shareholders are compromised when mutual funds are operated in the interest of fund advisers. In this regard, one of the Act's major objectives is to ensure that investors receive adequate and accurate information.This study focuses...

There are doubtlessly several scenarios in which investors are inclined or driven to invest in actively managed mutual funds. First, there is the investor whose 401(k) plan only offers actively managed funds, or index funds that are not cost efficient and/or do not track effectively.Second,...

This study uses the portion of a new Total Expense Ratio construct that discloses the reality of adviser/distributor payments of distribution fees (hidden) to sales brokers behind the mutual fund curtain. Distribution fees consist of dealer (broker) concessions, account servicing (12b-1) fees),...

The actual returns on mutual funds earned by investors are much lower than the rational behavior paradigm of financial economics would suggest. Certainly this is evidenced in the performance of funds distributed through the advisor channel. From the evidence here and elsewhere, much (if not...

We investigate the relation between the performance and characteristics of 1,779 domestic, actively managed retail equity mutual funds with diverse expense ratios. We show that using expense ratio standard deviation classes is an effective method for characterizing fund expenses for investors....

The background to this study is the failure of mutual fund independent directors to fulfill their obligations as ldquo;shareholder watchdogs,rdquo; as defined in the Investment Company Act of 1940. Normative transparency of information is fund adviser disclosure proactively ldquo;requestedrdquo;...