The Information Content of Australian Managed Fund Ratings

Robert William Faff, Jerry T. Parwada and Hun-Lune Poh

Journal of Business Finance & Accounting, 2007-11, vol. 34, issue 9-10, pages 1528-1547

Abstract: We examine the information content of managed fund ratings for Australian retail investors. Because fund ratings, premised on a quantitative-qualitative model, are highly transitory, we question whether investors formulate their investment decisions with respect to changes in ratings and whether ratings, in turn, react to fund flows. We find that information regarding fund flows can be obtained from ratings, and that rating changes can have far-reaching effects. Investors flock to newly upgraded funds while they penalize those that have been downgraded by withdrawing funds. Investors are constantly anticipating ratings revisions, particularly downgrades, and we attribute this phenomenon to the role of qualitative factors in the ratings. Copyright 2007 The Authors Journal compilation (c) 2007 Blackwell Publishing Ltd.

Date: 2007-11

Downloads: (external link)
http://www.blackwell-synergy.com/doi/abs/10.1111/j.1468-5957.2007.02053.x link to full text (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:bla:jbfnac:v:34:y:2007-11:i:9-10:p:1528-1547

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0306-686X

Access Statistics for this article

Journal of Business Finance & Accounting is edited by P. F. Pope, A. W. Stark and M. Walker

More articles in Journal of Business Finance & Accounting from Blackwell Publishing
Series data maintained by Christopher F. Baum ().