What style-timing skills do mutual fund “stars” possess?

Li-Wen Chen, Andrew Adams and Richard Taffler

Journal of Empirical Finance, 2013, vol. 21, issue C, 156-173

Abstract: Recent studies suggest that certain growth-oriented fund managers have substantial skill but do not stipulate the particular skills that they possess. We examine in detail the style-timing abilities of growth-oriented equity mutual funds over the period from 1993 to 2006. We find that an important contributor to the persistent abnormal returns is growth timing, i.e., switching stocks along the value/growth continuum, and that this explains at least 45% of the abnormal returns reported. No other style-timing skills are observed. Our results also demonstrate that it is easy to misidentify growth timing as market timing.

Keywords: Mutual fund performance; Growth funds; Timing skill (search for similar items in EconPapers)
JEL-codes: G23 (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:empfin:v:21:y:2013:i:c:p:156-173

DOI: 10.1016/j.jempfin.2013.01.004

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