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http://ssrn.com/abstract=1951524
 
 

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What is in a Name? Mutual Fund Flows When Managers Have Foreign-Sounding Names


Alok Kumar


University of Miami - School of Business Administration

Alexandra Niessen-Ruenzi


University of Mannheim - Department of Finance

Oliver G. Spalt


Tilburg University - Department of Finance

October 3, 2013


Abstract:     
We show that name-induced stereotypes affect the investment choices of U.S. mutual fund investors. Managers with foreign-sounding names have about 10% lower annual fund flows and this effect is stronger among funds that have more conservative clienteles or are located in conservative regions. "Foreign" managers also experience lower appreciation (greater decline) in flows following good (bad) performance. Following 9/11, flows to funds with managers with Middle-Eastern names decline abnormally. Even in an experimental setting where skill differences are absent, individuals allocate 14% less money to the "foreign" index fund. This gap widens by 42% following the Boston marathon bombings.

Number of Pages in PDF File: 88

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Date posted: November 2, 2011 ; Last revised: October 4, 2013

Suggested Citation

Kumar, Alok and Niessen-Ruenzi, Alexandra and Spalt, Oliver G., What is in a Name? Mutual Fund Flows When Managers Have Foreign-Sounding Names (October 3, 2013). Available at SSRN: http://ssrn.com/abstract=1951524 or http://dx.doi.org/10.2139/ssrn.1951524

Contact Information

Alok Kumar (Contact Author)
University of Miami - School of Business Administration ( email )
514 Jenkins Building
Department of Finance
Coral Gables, FL 33124-6552
United States
305-284-1882 (Phone)
HOME PAGE: http://moya.bus.miami.edu/~akumar
Alexandra Niessen-Ruenzi
University of Mannheim - Department of Finance ( email )
Mannheim, 68131
Germany
Oliver G. Spalt
Tilburg University - Department of Finance ( email )
Department of Finance
Tilburg University
Tilburg, 5000 LE
Netherlands
+31 13 466 3545 (Phone)
HOME PAGE: http://www.oliverspalt.com
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