Abstract

http://ssrn.com/abstract=2260370
 


 



Alternative Marketing for Alternative Investments


Yan Lu


University of Central Florida - College of Business Administration

Debanjan Mitra


University of Florida

David K. Musto


University of Pennsylvania - Finance Department

Sugata Ray


University of Florida - Warrington College of Business Administration

January 2015


Abstract:     
Until recently, hedge funds could advertise only indirectly, because direct solicitation was banned. We analyze the causes and effects of indirect advertising by relating the ads for hedge funds’ parent institutions and sibling mutual funds back to the hedge funds’ circumstances, and forward to their flows and performance. We find that abnormally low net inflows predicts the ads, which in turn leads to increased future net inflows, indicating that ads boost sagging flows. We also find that the incidence of large losses increases after ads. Thus, we conclude that indirect advertising is effective but poses some risk to consumers.

Number of Pages in PDF File: 46

Keywords: Hedge fund, advertising ban


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Date posted: May 4, 2013 ; Last revised: March 17, 2015

Suggested Citation

Lu, Yan and Mitra, Debanjan and Musto, David K. and Ray, Sugata, Alternative Marketing for Alternative Investments (January 2015). Available at SSRN: http://ssrn.com/abstract=2260370 or http://dx.doi.org/10.2139/ssrn.2260370

Contact Information

Yan Lu
University of Central Florida - College of Business Administration ( email )
PO Box 161400
Orlando, FL 32816
United States
Debanjan Mitra
University of Florida ( email )
Gainesville, FL 32611
United States
David K. Musto
University of Pennsylvania - Finance Department ( email )
The Wharton School
3620 Locust Walk
Philadelphia, PA 19104
United States

Sugata Ray (Contact Author)
University of Florida - Warrington College of Business Administration ( email )
Gainesville, FL 32611
United States
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