Market penetration strategies and the fee--performance relationship: the case of Spanish money mutual funds

Luis Muga and Rafael Santamaria

The Service Industries Journal, 2008, vol. 30, issue 9, 1529-1547

Abstract: This article shows that market penetration strategies are common practice during the product introduction stage in the money mutual funds in Spain. During this stage there is no relation between fees and performance because this strategy is optimal. In order to analyse this relationship during the other stages of the product life cycle, funds under three years old were omitted from the analysis. Among the remaining funds, those with the highest fees are found to present a higher gross return than the low-fee funds, although the difference is not statistically significant. Nevertheless, in terms of net returns, low-fee funds are observed to stochastically dominate high-fee funds for any risk-averse investor. These findings hold for any managerial skill level or segmentation by the mutual fund family type.

Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://hdl.handle.net/10.1080/02642060802626816 (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: https://EconPapers.repec.org/RePEc:taf:servic:v:30:y:2008:i:9:p:1529-1547

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/FSIJ20

DOI: 10.1080/02642060802626816

Access Statistics for this article

The Service Industries Journal is currently edited by Eileen Bridges, Professor Domingo Ribeiro, Ronald Goldsmith, Barry Howcroft and Youjae Yi

More articles in The Service Industries Journal from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().