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Diss. Stockholm : Handelshögskolan, 2001.

Thesis (Ph. D.)--University of Texas at Austin, 2008. / Vita. Includes bibliographical references.

Thesis (MS)--Montana State University--Bozeman, 2009. / Typescript. Chairperson, Graduate Committee: James R. Brown. Includes bibliographical references (leaves 42-45).

Thesis (Ph. D.)--University of Texas at Austin, 2006 / Vita. Includes bibliographical references.

Traditional banking theory has always viewed banks as financial intermediaries. Technological developments and regulatory changes have given rise to different types of non-bank financial intermediaries. Researchers have made claims about banks losing importance due to the emergence of non-bank financial intermediaries. As a non-bank financial intermediary, money market mutual funds have experienced phenomenal growth in Europe and the United States over the years. This growth has also been evident in South Africa in the past ten years. Several researchers have investigated the alleged disintermediation of banks’ traditional deposit taking in favour of investment management activities like managed funds. These researchers have found different levels of existence of such disintermediation in the different countries wherein the research was conducted. None of the research known to the author has provided empirical evidence of or refuted the allegation that the traditional deposit taking role of banks is declining and that money market mutual funds are substitutes for banks’ deposits. Moreover, such research has not been conducted in South Africa. Using banks’ deposits data and the net assets of money market mutual funds reported at the South African Reserve Bank, this thesis uses regression techniques to provide evidence for the substitutability of banks’ deposits by money market mutual funds. This substitution exists more in long-term deposit and short-term deposit products. The regression models derived in this thesis are found to be stable enough to be used for forecasting total bank deposits. / Dissertation (MBA)--University of Pretoria, 2010. / Gordon Institute of Business Science (GIBS) / unrestricted

Changes in quarterly holdings of Domestic General Equity unit trust funds in JSE sectors displayed a negative association with same quarter returns. The results were obtained from cross tabulations of unit trust sector holdings data taken from the period June 2002 to June 2009. The relationship was consistent with loss aversion behaviour: a tendency to hold stocks with negative returns to avoid realising a loss, and to sell stocks with positive returns to achieve a more immediate gain. This finding at the sector level of unit trust holdings was a reversal of the positive correlation between changes in holdings and stock returns observed in US mutual funds by Sias, Starks and Titman (2006). Those sectors purchased by Domestic General Equity unit trusts in the preceding quarter generated significant positive abnormal returns over the following quarter. Trading rules, which replicated the weighted purchasing of sectors by unit trusts, were tested for holding periods of between one and four quarters. The trading rule with a single quarter holding period, generated an estimated cumulative return 43% greater than a benchmark of equal sector weightings from September 2002 to June 2009; but the high level of transaction costs associated with an average annual portfolio turnover ratio of 3.0 made it impossible to achieve such a return in practice. / Dissertation (MBA)--University of Pretoria, 2010. / Gordon Institute of Business Science (GIBS) / unrestricted

The Canadian mutual fund industry has been well recognized as being the fastest growing financial intermediary in Canada. An examination of this industry as a financial intermediary and the reasons behind its rapid growth represents the fundamental purpose of this thesis. This examination encompasses a brief study of the Canadian capital market and of the financial intermediaries operating in this market. It also confirms the growth position of the Canadian mutual fund industry relative to other major financial institutions. The Canadian mutual fund industry is then more fully discussed to provide the reader with a basic understanding of what mutual funds are, how they are organized, their growth, how they differ from other financial institutions, what relationships they have to other financial institutions, what benefits or financial services they provide and finally, how they are sold. This background information provides insight into the attractiveness of the mutual fund package and the effective means by which it has been sold. Once this insight is attained, it is possible to analyze the factors that have created public interest in the mutual fund package. A projection of the future growth of the industry is then attempted based on social and technological changes expected to favour the mutual fund form of investment and specific industry innovations geared to creating new demands for an expanding range of financial services. Many interesting conclusions are reached as a result of this growth study of the Canadian mutual fund industry. Firstly, it is concluded that the pooling of savings in a single diversified portfolio combined with professional management, marketability, accumulation plans, administrative features, dollar-cost averaging, variety of mutual funds and withdrawal rights, when combined, form a very attractive investment package offered by mutual funds to potential investors. At the same time, the industry has been remarkably successful in developing channels of distribution through which the mutual fund package has been sold to the Canadian public on a national basis. Secondly, it is concluded that certain environmental factors have stimulated tremendous public interest in mutual funds; hence causing the industry's rapid asset growth from 1957 to 1968. These environmental factors are the growth in personal net savings, a development of financial sophistication by Canadian savers and a marked public preference to save through specific financial institutions. An analysis of each one of these factors reveals developments which have enabled the Canadian mutual fund industry to expand its assets. The growth in personal net savings, for instance has been accompanied by a desire for higher rates of return as a means of inflation protection. The traditional approach for such protection has been to invest in equities of growth corporations. Mutual funds have represented an attractive vehicle for equity participation by investors who also desire professional investment management. A development of financial sophistication by Canadian savers has been revealed by their demand for investments in which risks are large but where potential rewards are great. In addition, they have demanded a broader range of financial services. Mutual funds and other financial institutions which have altered their package offering to include an increased amount of investment counselling and investment management have benefited in terms of growth. The growing tendency toward indirect investment through financial institutions is somewhat difficult to understand, especially when increasing financial sophistication assumes that individuals progress from indirect to direct investment. The explanation for this inconsistent trend is based upon three problems in the Canadian financial community. First, the class structure has had a limiting effect on the amount of common stock available to middle class investors as large holdings become consolidated in the hands of the wealthy. Second, there is a shortage in the supply of equities becoming available in relation to an expanding demand for equities. Third, brokerage firms in Canada and the United States have begun to show a reluctance to service small investment accounts. As a result of these three problems, the small investor has gradually altered his investment strategy by participating in the equities markets indirectly through mutual funds and other financial institutions offering similiar opportunities. The third and final conclusion reached in this study is that the Canadian mutual fund industry will continue to maintain its relative growth position in the immediate future. An examination of expected social and technological changes reveals that the mutual fund concept of investing will gain wider public acceptance. In terms of innovations, this industry has made tremendous strides which should enhance its future expansion. The formation of mutual fund complexes, financial complexes and venture funds represent three such innovations. All three will enable the industry to provide potential investors with an integrated line of financial services and to spread operating costs over a wider range of activities. / Business, Sauder School of / Graduate

This dissertation consists of two chapters. First chapter examines whether herding by actively managed equity funds affects their performance. For this purpose, first the effect of herding on stock returns is reexamined and evidence is found that, during the herding quarter, stocks bought intensely by herds outperform stocks sold intensely by herds. Controlling for subsequent quarter herding, this performance difference reverses, an indication that herding drives prices away from their fundamental values. It is also shown that herding funds benefit from this activity during the quarter in which they herd. The evidence is provided that herded stocks positively contribute to the herding funds' trade portfolio returns in the following quarter, but no association is found between the extent to which funds herd and their holding-based and subsequent quarter net returns. Introducing the concept of leader and follower funds this study shows that the subsequent quarter performance of funds that lead the herd is superior to that of follower funds. However, because leader and follower funds do not strongly retain their status overtime, they exhibit similar long-run performances. Second chapter examines whether mutual funds herd in industries and the extent to which such herding impacts industry valuations and fund performance. Using two herding measures proposed by Lakonishok, Shleifer, and Vishny (1992) and Sias (2004) it is documented that mutual funds herd in industries beyond what would be expected by chance. It is shown that industry herding is not driven by investor flows and that it is not a manifestation of individual stock herding. The evidence suggests that, during the herding quarter(s), industries that experience strong buy herding by mutual funds outperform industries that experience strong sell herding. Industries that are subjected to strong herding by mutual funds exhibit no return reversals indicating that this activity does not destabilize industry values. Using a modified Grinblatt, Titman and Wermers' (1995) fund herding measure that quantifies the degree to which a fund joins the herd during a given quarter, no compelling evidence is found that industry herding affects the subsequent performance of herding funds. / Ph. D.

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