The Rise of Fund Managers in Foreign Exchange:Will Fundamentals Ultimately Dominate?

Thomas Gehrig and Lukas Menkhoff

The World Economy, 2005, vol. 28, issue 4, 519-540

Abstract: This paper analyses the behaviour and motivation of fund managers in foreign exchange markets reflected in questionnaire evidence. We find that fund managers and FX dealers differ significantly. Fund managers rely more on fundamentals, basically due to their longer forecasting horizons, and reject non‐fundamental influences on exchange rates more than FX dealers. However, neither can fund managers be considered as pure fundamentalists. Non‐fundamentalist positions markedly influence short‐term decision‐making. They inspire ambivalent views about market imperfections and these views seem to become stronger over time. This latter change counterbalances the strengthening fundamental influences resulting from the rise of fund managers.

Date: 2005
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (20)

Downloads: (external link)
https://doi.org/10.1111/j.1467-9701.2005.00690.x

Related works:
Working Paper: The Rise of Fund Managers in Foreign Exchange: Will Fundamentals Ultimately Dominate? (2004)
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:bla:worlde:v:28:y:2005:i:4:p:519-540

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=0378-5920

Access Statistics for this article

The World Economy is currently edited by David Greenaway

More articles in The World Economy from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().