We document that prior work experience of mutual fund managers outside of the asset management industry is valuable … from an investment perspective in that it provides managers with a stock picking and industry timing advantage. Fund … managers' stock picks from industries where they previously worked outperform stock picks from their non-experience industries …

We study whether fund families efficiently allocate their fund managers to different market segments. Whether a fund … employed. We show that in the more efficient investment grade bond fund market segment, fund managers cannot translate higher … skill into higher fund alpha. In contrast, skilled managers can generate higher alpha in the less efficient high yield bond …

We show that fund families allocate their fund managers to different market segments such that their skill is rewarded … she works. Even skilled managers can generate alpha only if the market segment is inefficient. Fund families take this … relation between skill and inefficiency into account and allocate their best managers to the least efficient market segment …

family and to important risk taking incentives for fund managers. -- Mutual Funds ; Fund Families ; Performance Flow …