Equity Fund Size and Growth: Implications for Performance and Selection

Posted: 23 Oct 1996

See all articles by Conrad S. Ciccotello

Conrad S. Ciccotello

Daniels College of Business, University of Denver

C. Terry Grant

University of Mississippi - Patterson School of Accountancy

Multiple version iconThere are 2 versions of this paper

Date Written: Undated

Abstract

Should individuals choose the largest or smallest equity funds for investment? This study explores the relationship of equity fund size to performance. Historical returns of large funds are found to be superior to their smaller peers. Yesterday's best performing funds tend to become today's largest funds as individuals invest heavily in response to the communications about the funds past success. But the findings suggest that, once large, equity funds do not outperform their peers. Especially for funds in aggressive growth objects, the advantages of being smaller appear to outweigh the disadvantages. For individual investors with aggressive growth objects, a strategy of investing in smaller funds may thus be wealth maximizing.

JEL Classification: G10

Suggested Citation

Ciccotello, Conrad S. and Grant, C. Terry, Equity Fund Size and Growth: Implications for Performance and Selection (Undated). Available at SSRN: https://ssrn.com/abstract=7841

Conrad S. Ciccotello

Daniels College of Business, University of Denver ( email )

2201 S. Gaylord St
Denver, CO 80208-2685
United States

C. Terry Grant (Contact Author)

University of Mississippi - Patterson School of Accountancy ( email )

730 East Beach Blvd.
Long Beach, MS 39560
United States
601-86702621 (Phone)
601-865-4588 (Fax)

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