This article is centered on those factors that are relevant forinvestors in equity Mutual Funds. More specifically it focuses on net flows that go to a fund and its relation with performance, costs and other variables. The methodology is based on Fama and MacBeth (1973), and results indicate a strong sensitivity of flows to past returns, and some evidence that investors react asymmetrically to bad or good past performance. Costs charged by the fund is a statistically significant variable and relevant for investor’s decisions. Other results indicate some evidence on the relevance of fund size, and mutual funds related to banking firms apparently have no advantage to other funds in the industry.
Gregoire C., J., & Granzow C., H. (2010). Investment flows in mutual funds and investor behavior: empirical evidence in Chile. Estudios De Administración, 17(1), 1–23. https://doi.org/10.5354/0719-0816.2010.56330
