Individual Investor Activity and performance

Item Type Journal paper
Abstract We examine the daily activity and performance of a large panel of individual investors in Sweden's Premium Pension System. We find that active investors earn higher returns and risk-adjusted returns than inactive investors. A performance decomposition analysis reveals that most of the outperformance of active investors is the result of these investors successfully timing mutual funds and asset classes. While activity is beneficial for some investors, extreme flows out of mutual funds affect funds' net asset values negatively for all investors. Financial advisors, by contributing to coordinate investments and redemptions, exacerbate these negative effects.
Authors Dahlquist, Magnus; Martinez, José Vincente & Söderlind, Paul
Journal or Publication Title The Review of Financial Studies
Language English
Keywords 401(k), coordinated fund changes, defined contribution, financial advisors, mutual fund flows
Subjects economics
HSG Classification contribution to scientific community
HSG Profile Area SOF - System-wide Risk in the Financial System
Refereed Yes
Date 1 March 2017
Publisher Oxford Univ. Press
Place of Publication Cary, NC
Volume 30
Number 3
Page Range 866-899
Number of Pages 33
ISSN 0893-9454
ISSN-Digital 1465-7368
Publisher DOI
Depositing User Prof. PhD. Paul Söderlind
Date Deposited 05 May 2014 12:16
Last Modified 20 Jul 2022 17:20


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Dahlquist, Magnus; Martinez, José Vincente & Söderlind, Paul (2017) Individual Investor Activity and performance. The Review of Financial Studies, 30 (3). 866-899. ISSN 0893-9454

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