Speed of information diffusion within fund families

Arbeitspapier

We document that the speed of information dissemination within mutual fund families positively affects the performance of member funds. This suggests that the resulting benefits of higher information precision far outweigh free-riding costs associated with fast internal dissemination. The performance effect intensifies when information travels across managers from different rather than same styles. This is consistent with fast information diffusion aggregating complementary insights that sharpen information precision, but also with fewer free-riding opportunities among managers from different styles. Managers exploit the resulting higher information precision rationally by trading more, relying less on public information, and investing differently from unaffiliated peers.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CFR Working Paper ; No. 15-02 [rev.]

Classification and Topics

• Classification: Wirtschaft ; Organizational Behavior; Transaction Costs; Property Rights ; Search; Learning; Information and Knowledge; Communication; Belief; Unawareness ; Pension Funds; Non-bank Financial Institutions; Financial Instruments; Institutional Investors ; Firm Organization and Market Structure
• Subject: Information diffusion ; mutual fund performance ; fund families ; investment behavior ; organizational structures

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Cici, Gjergji ; Jaspersen, Stefan ; Kempf, Alexander
• Event: Veröffentlichung
• (who): University of Cologne, Centre for Financial Research (CFR)
• (where): Cologne
• (when): 2015

Further information

• Handle: http://hdl.handle.net/10419/112725
• Last update: 10.03.2025, 11:45 AM CET