Managerial Rents vs. Shareholder Value in Delegated Portfolio Management: The Case of Closed-End Funds

• 成果类型: Article
• 署名作者: Wu, Youchang; Wermers, Russ; Zechner, Josef
• 署名单位: University of Oregon; University System of Maryland; University of Maryland College Park; Vienna University of Economics & Business
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhw065
• 发表日期: 2016
• 页码: 3428
• 关键词: performance; FLOWS; governance; COMPENSATION; discounts; liquidity; policies; IMPACT; COSTS; fees

摘要

We examine the dynamics of assets under management (AUM) and management fees at the portfolio manager level in the closed-end fund industry. We find that managers capitalize on good past performance and favorable investor perceptions about future performance, as reflected in fund premiums, through AUM expansions and fee increases. However, the penalties for poor performance or unfavorable investor perceptions are either insignificant, or substantially mitigated by manager tenure. Long tenure is generally associated with poor performance and high discounts. Our findings suggest substantial managerial power in capturing CEF rents. We also document significant diseconomies of scale at the manager level.