We study a natural experiment in the Indian mutual funds sector that created a 22 month period in which closed-end funds were allowed to charge an arguably shrouded amortized fee whereas open-end funds were forced to charge standard entry loads. We find that allowing closed-end funds to charge...

This paper examines the predictive power of investment managers' sentiment revealed in their letters to shareholders for their future performance, using closed-end funds (CEFs) as a laboratory. We find that pessimistic tone in managers' letters to shareholders predicts superior future...

We estimate investors' attention level to mutual fund fees based on a parsimonious asset allocation model with limited attention in an experimental setting. We find that, on average, investors allocate 62.5% of their full attention to mutual fund fees. We also find that cognitive ability is an...

A primary risk associated with business groups entering the financial sector is that groups will misallocate capital to own group firms, hurting investors and economic development. We study this issue in the context of business group owned mutual funds in India, where business groups have been...

We evaluate a major Indian investor protection reform that attempted to reduce commissions tied to mutual fund sales by banning the distribution fees that mutual funds had previously earmarked for commissions. We identify the policy impact by comparing funds charging high versus low distribution...

Commissions-motivated agents have historically helped the development of many markets, but research suggests brokers motivated by commissions sometimes steer consumers towards inappropriate products. This issue is particularly important in household financial markets where consumers may be...