Diversification possibilities enable investors to manage portfolio risk and decrease exposure to it, in order to prevent their portfolios from losing value. Well-diversified portfolio is the one that contains different asset classes with low return’s correlations. Essentially, portfolio...

Investment funds are highly connected with each other, but also with the broader financial system. In this paper, we quantify potential vulnerabilities arising from funds' connectedness. While previous work exclusively focused on indirect connections (overlapping asset portfolios) between...

Mutual funds' exposure to corporate bonds has brought concerns about risks arising from liquidity transformation back to the fore. With a focus on fund asset liquidity and investors, this paper explores the flow-performance relationship and the liquidity management of funds in the presence of...