This study relates to the overall concern that mutual fund payments of sub-accounting fees to broker/dealers for sub-transfer agency, administration, sub-accounting, and other shareholder services may improperly include distribution related services. The topics begin with a review of the basic...

There are several regulatory, nuanced, and interpretive discussions of mutual fund distribution issues, including revenue sharing, 12b-1 fees, and defensive 12b-1 plans. The world of fund distribution to intermediaries for sales of fund shares is not quantum physics, but it is much more hidden...

There are several regulatory, nuanced, and interpretive discussions of mutual fund distribution issues, including revenue sharing, 12b-1 fees, and defensive 12b-1 plans. The world of fund distribution to intermediaries for sales of fund shares is not quantum physics, but it is much more hidden...

This paper evaluates the Morningstar mutual fund ranking system. We find that indeed higher Morningstar ratings are associated with higher returns on the portfolios including respectively five-, four-, three-, two- and one-star funds only (STAR5 to STAR1). We then perform an unconditional and...

We develop a principal-agent model based on a sequential game played by a representative investor and a fund manager in an asymmetric information framework. The model shows that investors' perceptions of the fund market play the key role in the fund's fee-setting mechanism. The managers' true...

We study a set of German open-end mutual funds for a time period during which this industry emerged from its infancy. In those years, the distribution channel for mutual funds was dominated by the brick-and-mortar retail networks of the large universal banks. Using monthly observations from...

This paper explores the incentives for mutual funds to trade with sibling funds affiliated with the same group. To this end, we construct a dataset of almost one million equity transactions and compare the pricing of trades crossed internally (cross-trades) with that of twin trades executed with...

We analyze the dispersion of month-end price marks simultaneously placed on identical corporate bonds by different US mutual fund managers before and after initiations of TRACE and introductions of issuers into Markit’s CDS database. Disseminated bonds show large and statistically significant...

A fund's performance is usually compared to the performance of an index or other funds. If a fund trails the benchmark, the fund manager is often replaced. We argue that this may lead to excessive risk-taking if fund managers differ in ability and have the opportunity to take excessive risk. To...

The mutual fund industry has experienced huge growth internationally, becoming one of the primary vehicles through which individuals and most institutions invest in capital markets. Thus, the evaluation of the performance of mutual funds has become a very interesting research topic both for...