Relationship between fund performance and characteristics of the malaysian unit trust fund

Research output: Contribution to journalArticle

3 Citations (Scopus)

Abstract

This study examines the relationship between fund performance and fund characteristics. The results show that funds' risk-adjusted returns are not significantly related to fund age and initial service charge and that riskier funds are able to generate higher returns which commensurate with their risk levels. The coefficients for expense ratio and portfolio turnover variables are not significantly different from zero. Since risk-adjusted returns are measured net of expenses, such findings are consistent with the arguments of the modified version of the efficient market theory. That is, fund managers are successful in making efficient use of resources to offset their expenses in acquiring and acting on new information. There is no evidence that fund size is related to funds' risk-adjusted returns. However, there is a strong evidence that the growth in fund size is negatively and significantly linked to fund performance, suggesting that as funds grow larger, they tend to become less efficient in their operations.

Original languageEnglish
Pages (from-to)29-43
Number of pages15
JournalSingapore Management Review
Volume32
Issue number1
Publication statusPublished - Mar 2010

Fingerprint

Fund performance
Trust funds
Unit trusts
Risk-adjusted returns
Expenses
Fund managers
Turnover
Fees
Resources
Coefficients
Efficient markets

Keywords

  • Fund characteristics
  • Fund performance
  • Mutual fund investment

ASJC Scopus subject areas

  • Business, Management and Accounting (miscellaneous)

Cite this

Relationship between fund performance and characteristics of the malaysian unit trust fund. / Low, Soo Wah.

In: Singapore Management Review, Vol. 32, No. 1, 03.2010, p. 29-43.

Research output: Contribution to journalArticle

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