A Tale of Two Types: Generalists vs. Specialists in Asset Management

60 Pages Posted: 26 Oct 2015 Last revised: 20 Oct 2017

See all articles by Rafael Zambrana

Rafael Zambrana

Nova School of Business and Economics

Fernando Zapatero

Questrom School of Business, Boston University

Date Written: October 18, 2017

Abstract

Based on the observation that some managers run funds within a single style --specialists-- while others run funds across several investment categories -- generalists -- we study whether management companies use specific rules to appoint managers as specialists or generalists. We find that management companies earn higher returns when they appoint managers: (1) with security picking ability as specialists; (2) with market-timing ability as generalists. Consistent with optimal allocation, specialists with timing ability are more likely to be reassigned as generalists. We relate our findings to the multi-tasking literature that discusses "distraction" and "spillover" effects as competing factors.

Keywords: Mutual Fund, Asset Management, Human Capital, Portfolio Manager, Specialist, Generalist, Multi-tasking.

JEL Classification: G20, G23, J24, M51

Suggested Citation

Zambrana, Rafael and Zapatero, Fernando, A Tale of Two Types: Generalists vs. Specialists in Asset Management (October 18, 2017). Available at SSRN: https://ssrn.com/abstract=2672858 or http://dx.doi.org/10.2139/ssrn.2672858

Rafael Zambrana (Contact Author)

Nova School of Business and Economics ( email )

Campus de Campolide
Lisbon, Lisbon 1099-032
Portugal

Fernando Zapatero

Questrom School of Business, Boston University ( email )

595 Commonwealth Avenue
Boston, MA 02215
United States
617-353-3631 (Phone)

Register to save articles to
your library

Register

Paper statistics

Downloads
270
Abstract Views
1,368
rank
112,948
PlumX Metrics