The purpose of this chapter is to review interactions between mutual funds and individual investors in choosing equity mutual funds. Probably the largest question is why both sophisticated and unsophisticated investors persist in investing in actively managed funds that generally result in...

Financial literacy has become a major area of research in recent years, both in the investment and retirement literature with respect to the increasing complexity of financial products and need to save for retirement. Studies generally find individuals are financially uninformed and lacking in...

This study documents why mutual fund markets reflect “imperfect competition.” Discussions include fund industry and legal performance, fund distribution, fund share classes, attributes of imperfect competition, actively managed funds and index funds, fund advertising, financial literacy, and...

First, this study reviews Morningstar analytical grading measures used by investors to choose mutual funds. These measures include Morningstar Star Ratings, Analyst Ratings, Total Pillar Ratings, Upside and Downside Capture Ratios, and Stewardship Ratings. Second, the study provides results of...

The research provides the mutual fund Total Cost Construct that would provide “normative transparency of disclosure" to shareholders if adopted by the fund industry and by the SEC for fund reporting and disclosure. Full disclosure would enhance analysis to estimate each cost item for samples,...

A bank loan yield model was developed which incorporates consideration of multi-collinearity, ease of estimation of loan-class yields, and adjustments for size and location. Estimation of an initial (loan-class variables only) version of the model confirmed Taylor's findings that the loan mix...

The purpose of this study is to discuss various types of agency conflicts that negatively impact mutual fund shareholder interests. In so doing, shareholders should get an improved understanding of conflicts that place them at such a disadvantage in fund investing. Many fund advisers are...

For investor and institutional class index mutual funds that track the S&P 500 Index, there are just 25 funds with statistically low expense ratios (management fee findings are found above). However, there are only five index funds - all investor class - with statistically very high and...

Domestic-hybrid mutual funds vary with respect to investment objective, active or index management, proportions of stocks and bonds, and the mix of stock cap size/investment style and, therefore, risk.There are several types of domestic-hybrid mutual funds that apply various stock/bond...

This study further develops and defines the concept of normative transparency of disclosure. As defined, mutual fund normative transparency is that fund proactive, voluntary disclosure as well as legal and regulatory disclosure required for investors to be able to make information efficient fund...