We provide an exploratory investigation of mutual funds' investment styles. Funds' styles tend to cluster around a broad market benchmark. When funds deviate from the benchmark they are more likely to favor growth stocks with good past performance. There is some consistency in styles, although...

Using a unique dataset, we document that only those closed funds for which no new fund is subsequently launched continuously deliver positive abnormal returns. This suggests the existence of an optimal fund scale. In spite of the potential diseconomies of scale, a non-trivial proportion of...

Recent empirical studies of mutual fund competition examine the relation between a fund’s performance, the fund manager’s compensation, and the fund manager’s choice of portfolio risk. This paper models a manager’s portfolio choice for compensation rules that can be either a concave,...

We investigate the value of active mutual fund management by examining the stockholdings and trades of mutual funds. We fine that stocks widely held by funds do not outperform other stocks. However, stocks purchased by funds have significantly higher returns than stocks they sell—this is true...