IQ and Mutual Fund Choice

• 成果类型: Article
• 署名作者: Grinblatt, Mark; Ikaheimo, Seppo; Keloharju, Matti; Knupfer, Samuli
• 署名单位: University of California System; University of California Los Angeles; Aalto University; Research Institute of Industrial Economics (IFN); Centre for Economic Policy Research - UK; BI Norwegian Business School
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2015.2166
• 发表日期: 2016
• 页码: 924-944
• 关键词: Mutual fund; iq; education; fees; portfolio choice

摘要

We show that cognitive ability influences mutual fund choice: high-IQ investors avoid funds with high management fees. Two competing stories can explain this phenomenon. One is that high-IQ consumers benefit less from costly services, as they find it easier to make informed financial decisions without external help. The alternative story is that these investors are less likely to overpay for the services they receive because they are either better judges of value or more capable of discerning the price charged for these services. A comprehensive data set of Finnish males' fund holdings supports both stories: consistent with the first story, high-IQ investors tend to avoid funds sold via expensive service-intensive channels and prefer a mix of equity and bond funds to expensive readily packaged balanced funds. Consistent with the alternative story, IQ and fees are inversely correlated, even after controlling for many fund services, including any operating at the fund family level.