Changes in the global investor base and the stability of portfolio flows to emerging markets

Luis Brandao-Marques, R. Gaston Gelos, Hibiki Ichiue () and Hiroko Oura

Journal of Banking & Finance, 2022, vol. 144, issue C

Abstract: The role of mutual funds in intermediating capital flows to emerging markets has grown, and the composition of types of funds has changed. Based on insights from the literature, we hypothesize that due to behavior of end investors, mutual fund flows are more sensitive to push- and pull factors when the assets held by funds are less liquid and the end investors are smaller, and when end investors can purchase or redeem funds more easily. Our empirical results based on fund-level asset allocation data across emerging markets are largely consistent with the hypotheses. Particularly, we find robust evidence that bond fund flows are more sensitive to pull- and push factors than equity fund flows. Since the share of fund types with higher sensitivities has tended to rise, the sensitivity of overall fund flows has likely increased. Our result also suggests that bond fund managers amplify selling pressure from end investors.

Keywords: Capital flows; Emerging markets; Mutual funds (search for similar items in EconPapers)
JEL-codes: F32 G15 G23 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0378426622001959
Full text for ScienceDirect subscribers only

Related works:
Working Paper: Changes in the Global Investor Base and the Stability of Portfolio Flows to Emerging Markets (2015)
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:eee:jbfina:v:144:y:2022:i:c:s0378426622001959

DOI: 10.1016/j.jbankfin.2022.106615

Access Statistics for this article

Journal of Banking & Finance is currently edited by Ike Mathur

More articles in Journal of Banking & Finance from Elsevier
Bibliographic data for series maintained by Catherine Liu ().