Portfolio Pumping in Mutual Fund Families

41 Pages Posted: 18 Mar 2017 Last revised: 5 Aug 2021

See all articles by Pingle Wang

Pingle Wang

University of Texas at Dallas, Naveen Jindal School of Management, Department of Finance

Date Written: May 30, 2018

Abstract

I document portfolio pumping at the fund family level, a strategy that non-star fund managers buy stocks held by star funds in the family to inflate their performance at quarter-end. Star funds with high family pumping activities show strong evidence of inflated performance after 2002, when the Securities and Exchange Commission increased regulation on portfolio pumping at the fund level. Stocks pumped by the strategy show strong reversals at the last trading day of the quarter. Non-star fund managers pumping for star funds receive substantially higher flows in the future, which cannot be explained by fund characteristics.

Keywords: Mutual Funds, Portfolio Pumping, Family Strategy

JEL Classification: G18, G23, G28, K22

Suggested Citation

Wang, Pingle, Portfolio Pumping in Mutual Fund Families (May 30, 2018). Fifth Annual Conference on Financial Market Regulation, Available at SSRN: https://ssrn.com/abstract=2933600 or http://dx.doi.org/10.2139/ssrn.2933600

Pingle Wang (Contact Author)

University of Texas at Dallas, Naveen Jindal School of Management, Department of Finance ( email )

800 West Campbell
Richarson, TX 75080
United States

HOME PAGE: http://www.wangpingle.com

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
379
Abstract Views
2,999
rank
109,516
PlumX Metrics