Mutual Funds and Exchange-Traded Funds

Building Blocks to Wealth

Edited by H. Kent Baker, Greg Filbeck, and Halil Kiymaz

Financial Markets and Investments

Provides a detailed, researched-based look at the latest trends in mutual funds and ETFs
Skillfully blends the contributions of scholars and practitioners from around the globe into a single review of some of the most critical topics involving these investment vehicles
Distills the results of empirical studies into easily-understood concepts that readers can use in practice
Contains discussion questions and answers for each chapter that help to reinforce key concepts

Mutual Funds and Exchange-Traded Funds

Building Blocks to Wealth

Edited by H. Kent Baker, Greg Filbeck, and Halil Kiymaz

Financial Markets and Investments

Description

Mutual Funds and Exchange-Traded Funds: Building Blocks to Wealth offers a synthesis of the theoretical and empirical literature primarily on mutual funds but also discusses related investment vehicles, especially ETFs. In this edited volume, noted scholars and practitioners write chapters in their areas of expertise. It interweaves the contributions of multiple authors into an authoritative overview of important but selective topics. Readers will gain an in-depth understanding of mutual funds and ETFs from experts from around the world. Based on research-based evidence, this is not intended to be a "how to" book; instead, it is a scholarly and in-depth approach to important investment subjects. Although the book places greater attention on these different types of investments in the United States, it also examines them in a global context.

In today's financial environment, mutual funds and ETFs are dynamic areas that continue to evolve at a rapid pace. Because the flow of materials on the subject is voluminous, this book, by necessity, must be selective because it cannot cover every aspect of this field. However, readers can gain important insights about each investment vehicle including its structure and uses, performance and measurement. Beyond these core topics and issues, the book also examines the latest trends, cutting-edge developments, and real-world situations. Given its broad scope, this practical and comprehensive book should appeal to investors, investment professionals, academics, and others interested in mutual funds and ETFs. In particular, this book should help investors make key asset allocation decisions while capturing the benefits of a highly diversified, well-constructed, lower-cost portfolio of complementary strategies that enhance financial wealth.

Mutual Funds and Exchange-Traded Funds

Building Blocks to Wealth

Edited by H. Kent Baker, Greg Filbeck, and Halil Kiymaz

Financial Markets and Investments

PART ONE BACKGROUND

1. Mutual Funds and Related Investment Vehicles: An Overview
H. Kent Baker, Greg Filbeck, and Halil Kiymaz

2. The Economics of Mutual Funds: Rewards and Risks
David M. Smith

3. The Role of Mutual Funds in Retirement and Education Savings
Sarah A. Holden

4. The Structure and Regulation of Mutual Funds
Robert Grohowski and Sean Collins

PART TWO MUTUAL FUNDS AND OTHER FUND

5. Open-End Funds
Conrad S. Ciccotello

6. Target Date Funds and Other Funds of Funds
Alistair Byrne and Trevor Oliver

7. Closed-End Funds
Z. Jay Wang

8. Non-U.S. Closed-End Funds
Dimitris Andriosopoulos, Mary Fletcher, and Andrew Marshall

9. Exchange-Traded Funds
Ehsan Nikbakht, Keith Pareti, and Andrew C. Spieler

10. Leveraged and Inverse Exchange-Traded Funds
Benjamin Aguilar, Michael Bianco, Christopher Milliken, and Andrew C. Spieler

PART THREE CLASSIFICATION OF FUNDS BY PRINCIPAL INVESTMENTS

11. Money Market Mutual Funds
Anna Agapova

12. Bond Mutual Funds
Sandeep Singh

13. Stock Mutual Funds
Grady Perdue

14. Socially Responsible Mutual Funds
Eddy Junarsin, Enrico Libert, and Frendy

15. Mutual Funds: Management Styles, Social Responsibility, Performance, and Efficiency
Tamas Barko and Luc Renneboog

PART FOUR ASSET ALLOCATION AND PERFORMANCE OF MUTUAL FUNDS

16. Strategic Asset Allocation and Rebalancing
Laura Andreu and José Luis Sarto

17. Building and Monitoring Mutual Fund Portfolios
Larry J. Prather, Han-Sheng Chen, and Ying-Chou Lin

18. Analyzing Mutual Funds
Bruce A. Costa and Keith Jakob

19. Predicting Mutual Fund Performance
Matthew R. Morey

20. Evaluating Mutual Fund Performance within Stochastic Discount Framework
Jonathan Fletcher

21. Mutual Fund Risk
Roberto Savona, Oreste Auleta, and Flippo Stefanini

PART FIVE FUND STRUCTURE

22. Organization, Structure, and Services of Mutual Funds
Mark Potter
23. Selected Topics in Mutual Fund Distribution
John A. Haslem
24. Mutual Fund Disclosure and Related Fund Investor Protection Features
Joseph A. Franco
25. New Developments in Exchange-Traded Funds
Ojwang' George Omondi

26. Ethical Standards in Mutual Funds
Rosa Adamo

PART SIX MUTUAL FUNDS WORLDWIDE

27. Mutual Funds in Emerging and Developing Markets
Parvez Ahmed

28. Performance of Global Mutual Funds
Tarik Bazgour, Laurent Bodson, and Danielle Sougné

29. Performance of ETFs
Panagiotis Schizas

30. Issues, Trends, and Future Developments in the Mutual Fund Industry
Hunter M. Holzhauer

Mutual Funds and Exchange-Traded Funds

Building Blocks to Wealth

Edited by H. Kent Baker, Greg Filbeck, and Halil Kiymaz

Financial Markets and Investments

Author Information

H. Kent Baker is a University Professor of Finance in the Kogod School of Business at American University. As one of the most prolific finance academics, Professor Baker has authored or edited 25 books and has published more than 160 refereed articles in such journals as the Journal of Finance, Journal of Financial and Quantitative Analysis, Financial Management, Financial Analysts Journal, and Journal of Portfolio Management. He has consulting and training experience with more than 100 organizations. Professor Baker holds a BSBA from Georgetown University; M.Ed., MBA, and DBA degrees from the University of Maryland; and an MA, MS, and two PhDs from American University. He also holds CFA and CMA designations.

Greg Filbeck is a Samuel P. Black III Professor of Finance and Risk Management at Penn State Erie, the Behrend College and serves as Associate Director and Department Chair of Finance & Economics for the Black School of Business. Professor Filbeck has authored or edited seven books and published more than 75 refereed academic journal articles appearing in the Financial Analysts Journal, Financial Review, and Journal of Business, Finance, and Accounting. He received a BS from Murray State University, an MS from Penn State University, and a DBA (finance) from the University of Kentucky. He recently earned a Master's Degree in Applied Statistics from Penn State University. He also holds the CFA, FRM, PRM, and CAIA designations.

Halil Kiymaz is Bank of America Professor of Finance in the Crummer Graduate School of Business at Rollins College. Professor Kiymaz has published more than 70 articles in scholarly and practitioner journals and co-edited three books. His research has appeared in the Journal of Banking and Finance, Financial Review, Global Finance Journal, Journal of Applied Finance, Journal of Economics and Finance, and Review of Financial Economics, among others. Professor Kiymaz also serves on the editorial board of four journals and is the area editor of the International Journal of Emerging Markets. He has consulting and training experience with various organizations. Professor Kiymaz received a BS from the Uludag University and an MBA, MA, and PhD from the University of New Orleans.

Contributors:

Rosa Adamo
Anna Agapova
Benjamin Aguilar
Parvez Ahmed
Laura Andreu
Dimitris Andriosopoulos
Oreste Auleta
Tamas Barko
Tarik Bazgour
Michael Bianco
Laurent Bodson
Alistair Byrne
Han-Sheng Chen
Conrad S. Ciccotello
Sean Collins
Bruce A. Costa
Jonathan Fletcher
Mary Fletcher
Joseph A. Franco
Frendy
Robert Grohowski
John A. Haslem
Sarah A. Holden
Hunter M. Holzhauer
Keith Jakob
Eddy Junarsin
Enrico Libert
Ying-Chou Lin
Andrew Marshall
Christopher Milliken
Matthew R. Morey
Ehsan Nikbakht
Trevor Oliver
Ojwang' George Omondi
Keith Pareti
Grady Perdue
Mark Potter
Larry J. Prather
Luc Renneboog
José Luis Sarto
Roberto Savona
Panagiotis Schizas
Sandeep Singh
David M. Smith
Danielle Sougné
Andrew C. Spieler
Filippo Stefanini
Z. Jay Wang

Mutual Funds and Exchange-Traded Funds

Building Blocks to Wealth

Edited by H. Kent Baker, Greg Filbeck, and Halil Kiymaz

Financial Markets and Investments

Reviews and Awards

"The problem with mutual funds and ETFs is their vast number. There are more funds holding U.S. stocks than are stocks listed on the major U.S. exchanges. This quandary makes books such as Mutual Funds and Exchange-Traded Funds essential reading for scholars and practitioners. Many books are available on this subject, but this book is the most comprehensive." -- Richard A. Ferri, CFA, Founder and Director of Investing at Portfolio Solutions, LLC

"This is a well done, scholarly, and detailed book on the history, evolution, and academic research on mutual funds and ETFs. It will serve as a wonderful textbook for college courses, and it will help investors make better choices on asset allocation, fund choices, and investment strategies." -- Larry Swedroe, Director of Research of the BAM Alliance and the author or co-author of 15 books on investing, including The Incredible Shrinking Alpha

"This book is a compendium of a large spectrum of high-quality thought on the industrial organization, regulation, performance, and evolution of the mutual fund industry. It is a must-have for academics, fund employees, and regulators, as well as investment advisors and serious investors in mutual funds. I highly recommend it." -- Russ Wermers, Professor of Finance, University of Maryland, author of Performance Evaluation and Attribution of Security Portfolios

"An invaluable reference for academics and practitioners interested in learning more about the changing landscape of investing with ETFs and mutual funds." -- Ananth Madhavan, Global Head of iShares Research, BlackRock

"This book is a collection of thorough analyses of the niches of mutual fund and ETF investing and the issues confronting the investor in these vehicles. Notable are its clear graphs, easily digestible writing, imaginative insights, and meticulous editing." -- Ed Tower, Professor of Economics, Duke University