Star Power: The Effect of Monrningstar Ratings on Mutual Fund Flow

By Diane Del Guercio, Paula A. Tkac. 2008

355 citations recorded by the source corpus.

Subfields: Accounting, Economics and Econometrics, Finance

View Paper: https://www.semanticscholar.org/paper/904e9f7ab7f9ff9270202be799b7b1b2bc9720dc

How researchers see this paper

The researchers whose trusted networks rank it highest, strongest advocate first. Every researcher gets a different order.

In Accounting

1. D. Sosyura
2. Melvyn Teo
3. David H. Solomon
4. Eugene F. Soltes
5. P. O'Connell
6. Nerissa C. Brown
7. Russ Wermers
8. Kelsey D. Wei

In Economics and Econometrics

1. D. Sosyura
2. P. O'Connell
3. Nerissa C. Brown
4. David H. Solomon
5. Russ Wermers
6. Melvyn Teo
7. Kelsey D. Wei
8. Eugene F. Soltes

In Finance

1. D. Sosyura
2. Melvyn Teo
3. Eugene F. Soltes
4. P. O'Connell
5. Nerissa C. Brown
6. David H. Solomon
7. Russ Wermers
8. Kelsey D. Wei

Citations in the corpus

• Winners in the Spotlight: Media Coverage of Fund Holdings as a Driver of Flows (2014, background): “Morningstar ratings, obtained from Morningstar Direct, capture long-horizon historical fund performance (Sharpe, 1998) and serve as an additional control for the independent effect of fund ratings on capital flows (Del Guercio and Tkac, 2008).”
• WSJ Category Kings - the impact of media attention on consumer and mutual fund investment decisions (2017, neutral): “6 Del Guercio and Tkac (2008) conduct event studies of over 10, 000 Morningstar rating changes and show that these discrete rating changes lead to changes in mutual fund flows, above and beyond those predicted by a time-series benchmark regression of fund fundamentals.”
• Which Factors Matter to Investors? Evidence from Mutual Fund Flows (2016, neutral): “…returns include Bergstresser and Poterba (2002) (tax-adjusted performance), Coval and Stafford (2007) (fund-flow price pressure relationship), Del Guercio and Tkac (2008) (Morningstar rating changes), and Ivkovic and Weisbenner (2009) (differential sensitivity of in- and outflows to relative and…”
• Institutional Investors, Past Performance, and Dynamic Loss Aversion (2009, background): “Because manager compensation is often viewed as a convex function of performance (Chevalier and Ellison (1997), Del Guercio and Tkac (2008)), funds tend to cut risk following bouts of good performance and increase risk following bouts of poor performance (Chevalier and Ellison (1997), Elton, Gruber,”
• What Drives Market Share in the Mutual Fund Industry (2012, neutral): “In fact, Del Guercio and Tkac (2008) demonstrate that changes in Morningstar ratings have an effect on fund flows, independent of the effect of abnormal returns.”
• Analyst Recommendations, Mutual Fund Herding, and Overreaction in Stock Prices (2014, background): “As shown in Del Guercio and Tkac (2008), the Morningstar star rating affects investor flow independently of the influence of other common measures of fund performance.”
• Behavioral Biases of Mutual Fund Investors (2011, neutral): “This may be fostered by Morningstar’s practice of rating funds based on past returns (Del Guercio and Tkac (2008)).”