Comparison between Brazilian Exchange-Traded Funds and Mutual Funds Performance: A Multiscale Approach

2015 ◽  
Author(s):  
Bruno Milani ◽  
Paulo Sergio Ceretta
Keyword(s):  
Mutual Funds ◽  
Multiscale Approach ◽  
Exchange Traded Funds

scholarly journals FACTORS INFLUENCING THE INVESTORS TO INVEST IN MUTUAL FUNDS: AN EMPIRICAL ANALYSIS

2020 ◽  
Vol 6 (9) ◽  
pp. 45-52
Author(s):  
Bishwajit Rout ◽  
Sangeeta Mohanty
Keyword(s):  
Mutual Funds ◽  
Mutual Fund ◽  
Exchange Traded Funds ◽  
Equity Fund ◽  
Index Funds ◽  
Money Market Funds ◽  
Wide Range ◽  
Different Types ◽  
Fund Industry ◽  
Mutual Fund Industry

Indian mutual fund industry started with traditional products like equity fund, debt fund and balanced fund and later significantly increased it’s product base. Today, the industry has introduced a wide range of products such as money market funds, sector specific funds, index funds, gilt funds, insurance linked funds, exchange traded funds, and marching towards reality funds. The different types of schemes offered by the Indian mutual fund industry provide several options of investment to common man. What is noteworthy is that bulk of the mobilization has been by the private sector mutual funds rather than bank sponsored mutual funds. Through this paper the author has attempted to focus on the the factors that motivate the investors to invest in mutual funds.

scholarly journals Exchange-traded funds as an alternative investment option

2019 ◽  
pp. 7-37
Author(s):  
António Afonso ◽  
Pedro Cardoso
Keyword(s):  
Mutual Funds ◽  
Mutual Fund ◽  
Exchange Traded Funds ◽  
Price Efficiency ◽  
Index Funds ◽  
Equity Mutual Funds ◽  
Asset Value ◽  
Net Asset Value ◽  
Tracking Ability ◽  
Investment Option

We conduct an analysis of Exchange-traded Funds (ETFs), Index and Equity mutual funds and their respective benchmark during the 2010-2015 period for the Portuguese fund industry. For the period 2010-2017, we test ETFs for price inefficiency (existence of deviations between prices and the Net Asset Value) and persistence. We find that the studied ETF does not always outperform index funds in replicating the variations of the PSI 20 index, despite exhibiting better tracking ability when facing downside deviations of the benchmark and a better capacity of smoothing tracking deviations. Regarding ETFs price efficiency and its persistence, the study reveals that the examined ETF is priced at a low average discount with evidence of deviations persistence of at least two days. The investment schemes with the highest ability to track the PSI 20 Index were PSI20 (ETF), BBVA PPA Índice PSI20, and the equity mutual fund BPI Portugal.

Exchange Traded Funds and the likelihood of closure

2020 ◽  
Vol 35 (3/4) ◽  
pp. 105-127
Author(s):  
Aigbe Akhigbe ◽  
Bhanu Balasubramnian ◽  
Melinda Newman
Keyword(s):  
Mutual Funds ◽  
Hazard Model ◽  
Fund Performance ◽  
Individual Investors ◽  
Cox Proportional Hazard Model ◽  
Exchange Traded Funds ◽  
Proportional Hazard ◽  
Proportional Hazard Model ◽  
Content Type ◽  
Cox Proportional Hazard

PurposeThough exchange-traded funds (ETFs) are similar to mutual funds, we identify several reasons how they are different based on their structure and trading characteristics. Therefore, we argue that the determinants of fund closure decisions for ETFs will not be the same as the mutual funds. We systematically explore those factors.Design/methodology/approachWe use Cox Proportional Hazard model, which is considered a superior method, over the logistic regression models. All previous studies are based on logistic regressions.FindingsWe investigate the closure rate of ETFs over the 1995–2018 sample period. We find that the first three years are the most critical period for the survival of ETFs. Our full sample results show that early fund performance, the investment style of the fund, the expense ratio and fund family size are the most relevant factors influencing the likelihood of closure. When we consider equity-only funds, we find that key factors that influence fund closure are early fund performance, the expense ratio, failure to grow the fund's assets relatively quickly and the equity investment category of the fund.Research limitations/implicationsTracking error could be a significant factor. However, we have several missing values in the data. Therefore, we are forced to drop that variable. However, we use the SD of daily returns in lieu of that. Similarly, we were constrained by the availability of data for the equity style box scores.Practical implicationsOur study suggests that individual investors will be better off by investing in ETFs that are at least three-year to four-year old. If individuals want to invest in ETFs from the date of inception, the probability of survival is higher for an ETF within a larger fund family.Social implicationsHopefully, our research will attract the attention of CFPB and provide a warning to individual investors when they choose to invest in ETFs. More and more ETFs are getting included in retirement savings. So, abrupt ETF closures are likely to have large social implications for the future.Originality/valueWe are the first to use Cox Proportional Hazard model. We base our arguments from latest research on ETFs that the one earlier paper on ETF closure has missed. So, we examine the issue in a more systematic way.

The Growth and Changing Role of Passive Investments: A Critical Perspective on Index Mutual Funds and Exchange Traded Funds

2016 ◽  
Vol 28 (6) ◽  
Author(s):  
Wolfgang Bessler ◽  
Heinz J. Hockmann
Keyword(s):  
Corporate Governance ◽  
Mutual Funds ◽  
Systemic Risk ◽  
Market Competition ◽  
Product Market ◽  
Product Market Competition ◽  
Securities Market ◽  
Market Quality ◽  
Exchange Traded Funds ◽  
Negative Effects

AbstractIndex Mutual Funds (IMF) and Exchange Traded Funds (ETF) have developed into widely-accepted and fast growing passive investment instruments, offering investors a low-cost investment alternative in well diversified portfolios. Allocating more into IMFs and ETFs is the investors’ natural response to the experience with and the disillusion about actively managed investment performance. Despite these positive effects, this shift in fund allocation raises substantial concerns about possible negative effects on securities market trading and market quality, on corporate governance and product market competition as well as on systemic risk. Most research so far does not provide significant evidence of negative effects on market quality, on securities market trading, and on systemic risk. Whether the shareholdings of IMF and ETF providers reduces product market competition and whether the concentration of voting rights negatively effects corporate governance requires further analysis. Some problems may occur if ETF and IMF providers team-up with active investors. Overall, the introduction of IMFs and ETFs on broad market indices should be viewed as a financial innovation that broadens the investment spectrum providing many benefits to investors especially when viewed relative to the meager performance and performance persistence of actively managed mutual funds.

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