Managerial actions and their effects on investors: Essays on mutual funds and corporate spinoffs.

摘要

Corporate finance has long studied the effects of managerial actions and their impact on shareholders and other interested parties. This dissertation examines decisions made by managers in two different areas, yet many of the concerns are similar. The first area deals with mutual fund managers and how their decisions on mutual fund expenses affect their investors. We find that front load funds tend to attract investors with longer average holding periods. Investors who buy no load funds and trade more often see no significant gains from this strategy and in some cases lose money.; Decisions on mutual fund 12b-1 fees have different impacts. While the fee was designed as a way for funds to recoup distribution expenses, they are now often used by back load funds as a clandestine way to charge a load. An examination of fund advertising indicates that back load funds do not exhibit higher marketing costs than their front load or no load counterparts. We find mixed evidence overall that 12b-1 fees are being used to recoup advertising costs. Finally, funds that advertised over the Jain and Wu sample period had more highly autocorrelated inflows, indicating that the funds were effective bringing in new money. However, the reverse was true over the subsequent 3-year period, indicating that the benefits of advertising may be short-lived.; The second area deals with corporate spinoffs. It is assumed that agency conflicts resolve when a firm divests one of its divisions. This is not always true for spin-offs, as parent-firm insiders often hold shares in the spin-off and sit on its board of directors, giving them motive and opportunity to continue influencing their former subsidiary. We examine this corporate control issue with a sample of 70 spin-offs from 1990 to 1996. We find that the continued influence of the parent firm has very negative effects. Reductions in parent-firm insider presence are associated with significant increases in excess returns over four years. Parent-firm presence on the compensation committee exacerbates this problem. Focus-increasing spin-offs are positive, but not significant.