What Does It Mean to Be in a Team? Evidence from U.S. Mutual Fund Managers

59 Pages Posted: 21 Aug 2016

See all articles by Diamond Wang

Diamond Wang

University of Auckland - Department of Accounting and Finance

Date Written: June 17, 2016

Abstract

In recent years, team management has replaced single management to become the dominant management structure in the U.S. mutual fund industry. However, empirical studies on the impacts of team management show mixed results. Using accurate fund manager information from actively-managed equity mutual funds, this paper reexamines the effect of team management on fund outcomes after controlling for fund and managerial characteristics, as well as unobservable managerial heterogeneities that have shown to play an important role in determining fund performance. I find no evidence that fund performance differs between team- and single-managed funds. However, when a manager joins a large team, the manager on average receives less fund flow compared to when this manager manages a fund individually. The sensitivity of fund flow to fund performance for a manager is also lower when in a team compared to being single.

Keywords: Management Structure, Fixed Effects, Team Management, Performance Evaluation

JEL Classification: G23, J24

Suggested Citation

Wang, Diamond, What Does It Mean to Be in a Team? Evidence from U.S. Mutual Fund Managers (June 17, 2016). 29th Australasian Finance and Banking Conference 2016. Available at SSRN: https://ssrn.com/abstract=2825534 or http://dx.doi.org/10.2139/ssrn.2825534

Diamond Wang (Contact Author)

University of Auckland - Department of Accounting and Finance ( email )

Private Bag 92019
Auckland 1001
New Zealand

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