Efficient Market Managers

Quarterly Journal of Finance, forthcoming.

47 Pages Posted: 30 Nov 2020 Last revised: 23 Jan 2021

See all articles by Vladimir A. Atanasov

Vladimir A. Atanasov

William and Mary - Raymond A. Mason School of Business

Christo A. Pirinsky

University of Central Florida

Qinghai Wang

University of Central Florida - College of Business Administration

Date Written: January 22, 2021

Abstract

We examine the effect of the Efficient Market Hypothesis (EMH) on the investment behavior of mutual fund managers. We show that managers who are more likely to be exposed to the ideas of EMH throughout their higher education are more “passive” than their unexposed peers: they are more likely to manage index funds, and when managing active funds, they hold portfolios with larger numbers of stocks and deviate less from their investment benchmarks. Exposed managers, however, take more systematic risks. Although academic exposure to the EMH does not result in better performance, it helps professional investors generate capital inflows.

Keywords: Economic theory, active investing, efficient market hypothesis, mutual funds

JEL Classification: B31, D01, G23, G40

Suggested Citation

Atanasov, Vladimir A. and Pirinsky, Christo Angelov and Wang, Qinghai, Efficient Market Managers (January 22, 2021). Quarterly Journal of Finance, forthcoming., Available at SSRN: https://ssrn.com/abstract=3716401 or http://dx.doi.org/10.2139/ssrn.3716401

Vladimir A. Atanasov

William and Mary - Raymond A. Mason School of Business ( email )

P.O. Box 8795
Williamsburg, VA 23187-8795
United States

Christo Angelov Pirinsky (Contact Author)

University of Central Florida ( email )

College of Business Administration/Finance
PO Box 161400
Orlando, FL FL 32816
United States
407-823-5962 (Phone)

Qinghai Wang

University of Central Florida - College of Business Administration ( email )

PO Box 161400
Orlando, FL 32816
United States

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

Paper statistics

Downloads
125
Abstract Views
661
rank
316,162
PlumX Metrics