Does Misclassification of Equity Funds Exist? Evidence from Malaysia

MPRA Paper from University Library of Munich, Germany

Abstract: Applying the style analysis developed by Sharpe (1988, 1992), this paper investigates the classification of equity funds in Malaysia. A methodology for creating purified mutual fund style indexes is used to verify existing classifications. The paper concludes that an improper classification of funds would not only cause mismatch between investors objectives and funds’ profile, it also affects the process of income smoothing in the lifecycle of investors. Besides estimating the possible economic impact due to misclassification, this study highlights the importance of a proper classification system of equity funds in Malaysian context and its implication towards investor’s protection.

Keywords: Mutual Fund Classification; Style Analysis; Investor’s Protection (search for similar items in EconPapers)
JEL-codes: G18 G24 G30 (search for similar items in EconPapers)
Date: 2004, Revised 2005
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:2029

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