The Relevance of Family Characteristics to Individual Fund Flows

Abstract

This paper examines the relevance of fund specific and family variables in the determination of money flows to Australian investment funds. The existing literature establishes the relevance of past period returns to individual fund flows. Our results show that family characteristics are also relevant to flows. Investors in individual funds are sensitive to family size, family age and product proliferation. We also find some evidence that the top performing funds within a family receive greater flows. The reported relations show that investors recognise that a fund is an embedded member of the family, where fund-level and family-strategies are important to the investment decision.