Using a novel database, we show that the stock-price impact of analyst trade ideas is at least as large as the impact of stock recommendation, target price, and earnings forecast changes, and that investors following trade ideas can earn significant abnormal returns. Trade ideas triggered by...

This paper investigates whether bond fund managers with credit rating experience outperform their peers. We document that bond fund managers who previously worked in credit rat- ing agencies on average create higher risk-adjusted returns than their peers by 11-16 bps per month, with better...

In this paper, I investigate the asset allocation ability of mutual fund investors. Specifically, I examine differences among non-proprietary brokers, proprietary brokers and direct channels regarding their asset allocation ability. In aggregate, mutual fund investors do not seem to have...

This study shows that mutual fund managers vary in their reliance on category-level information, relative to firm-specific information about assets. Moreover, fund performance decreases with managers' propensity to rely on categories. Fund managers display less skill in picking stocks which are...

This paper analyzes determinants of home bias in equity funds based on monthly holdings data using panel and quantile regressions. We investigate 699 equity funds, domiciled in fifteen European countries, that broadly invested in European stocks from January 2003 to December 2016. More than...

We examine the relative weights hedge fund investors attach to past information in the fund selection process. The weighting scheme appears inconsistent with econometric forecasting models that predict fund returns, alphas or Sharpe ratios. In particular, investor flows are highly sensitive to...

Czarnitzki and Stadtmann (2005) measure the interdependence of demand for investment advice (approximated by sales of investor magazines) and stock prices. They find strong evidence that confirms the presence of the disposition effect, i.e. the empirical observation that investors sell winners...

This paper analyzes the response of the asset allocation process to fund performance and the broad market conditions as well as the market determinants of fund flows for hybrid funds. Using a fairly large sample of hybrid funds, our findings reveal the following: First, managers increase their...

This paper explores the hypothesis that investors gain information advantages through business connections made during prior employment. Mutual fund managers who previously worked as sell-side analysts put significantly more weight on the stocks they previously covered, and holdings of those...

Using a large sample of institutional investors' investments in private equity funds raised between 1991 and 2011, we estimate the extent to which investors' skill affects their returns. Bootstrap analyses show that the variance of actual performance is higher than would be expected by chance,...