Affiliation:
1. Département des sciences administratives, Université du Québec en Outaouais Campus Saint‐Jérôme Québec Canada
2. Département de finance et comptabilité, Université de Sousse Institut des Hautes Études Commerciales de Sousse (IHECSO) Sousse Tunisia
Abstract
AbstractWe investigate whether mutual funds that invest in initial public offerings (IPOs) outperform the Renaissance IPO Index, IPOX® 100 U.S. Index, and other comparable equity funds that do not invest in IPOs. We also explore whether investors gain diversification benefits by investing in IPO‐focused mutual funds. Using a sample of active open‐ended US equity mutual funds, we find that IPO‐focused funds outperform the Renaissance IPO Index and comparable funds that do not invest in IPOs. Moreover, they provide investors with the benefit of diversification along with better returns. We also find the value added by active management based on IPO strategy.
Funder
Social Sciences and Humanities Research Council of Canada
Cited by
1 articles.
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