Wermers, Russ, Wu, Youchang, Zechner, Josef. 2016. Managerial Rents vs. Shareholder Value in Delegated Portfolio Management: The Case of Closed-End Funds. Review of Financial Studies. 29 3428-3470.
BibTeX
Abstract
We examine the dynamics of assets under management (AUM) and management fees at the portfolio manager level in the closed-end fund industry. We find that managers capitalize on good past performance and favorable investor perceptions about future performance, as reflected in fund premiums, through AUM expansions and fee increases. However, the penalties for poor performance or unfavorable investor perceptions are either insignificant, or substantially mitigated by manager tenure. Long tenure is generally associated with poor performance and high discounts. Our findings suggest substantial managerial power in capturing CEF rents. We also document significant diseconomies of scale at the manager level.
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Status of publication | Published |
---|---|
Affiliation | WU |
Type of publication | Journal article |
Journal | Review of Financial Studies |
Citation Index | SSCI |
WU Journalrating 2009 | A+ |
Starjournal | Y |
Language | English |
Title | Managerial Rents vs. Shareholder Value in Delegated Portfolio Management: The Case of Closed-End Funds |
Volume | 29 |
Year | 2016 |
Page from | 3428 |
Page to | 3470 |
Reviewed? | Y |
URL | http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2179125 |
DOI | http://dx.doi.org/10.1093/rfs/hhw065 |
Open Access | N |
Associations
- People
- Zechner, Josef (Details)
- External
- Wermers, Russ (University of Maryland at College Park, United States/USA)
- Wu, Youchang (Wisconsin School of Business, United States/USA)
- Organization
- Institute for Finance, Banking and Insurance IN (Details)
- Research Institute for Capital Markets FI (Details)