Mutual Fund 'Soft-Dollar' Arrangements: Analysis and Findings
Journal of Wealth Management, Vol. 19, No. 1 (Fall 2016), pp. 101-107.
Posted: 20 May 2019
There are 2 versions of this paper
Mutual Fund 'Soft-Dollar' Arrangements: Analysis and Findings
Mutual Fund 'Soft-Dollar' Arrangements: Analysis and Findings
Date Written: July 29, 2016
Abstract
Mutual fund bundling services under soft-dollar arrangements may benefit shareholders — but it is also possible that shareholder capital is wasted through these arrangements. There are two major questions concerning bundling actively managed equity fund research and services in soft-dollar arrangements. First, do soft-dollar arrangements provide higher risk-adjusted fund performance and/or lower advisory fees? Or, second, are shareholder assets wasted through use of soft-dollar arrangements? The research findings answer “yes” only to the second question.
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