Measuring Innovation and Product Differentiation: Evidence from Mutual Funds

• 成果类型: Article
• 署名作者: Kostovetsky, Leonard; Warner, Jerold B.
• 署名单位: Boston College; University of Rochester
• 刊物名称: JOURNAL OF FINANCE
• ISSN/ISSBN: 0022-1082
• DOI: 10.1111/jofi.12853
• 发表日期: 2020
• 页码: 779-823
• 关键词: performance; COMPETITION; search; equity; alpha

摘要

We study innovation and product differentiation using a uniqueness measure based on textual analysis of prospectuses. We find that small and start-up families have higher start rates than larger families, and their products are more unique. Unique strategies attract more inflows in the first three years, and investors respond more to text-based uniqueness than other measures such as holdings or returns uniqueness. For established funds, word uniqueness has weak negative power for explaining returns, so investors in competitive equilibrium do not sacrifice much performance to get specialized products. Uniqueness attenuates the flow-performance relation, reducing the risk of investor outflows.