The Nature of Mutual Funds
CONRAD S. CICCOTELLO, J.D., Ph.D. Associate Professor and Director of Graduate Personal Financial Planning Programs, Georgia State University, Atlanta, Georgia
As a first-year doctoral student at the Pennsylvania State University in 1990, I wrote my investments seminar paper on the performance of a sample of open-end mutual funds. My professor indicated that the paper was methodologically sound but suggested to me that finance academics did not really care about mutual fund performance (or, for that matter, about mutual funds, in general). So he advised that I examine something else in future research. Academics often lag what is of interest in the “real world,” and I recall thinking that mutual funds were important, and likely to become more so over time. But as a doctoral student, one learns to do what one is told to do. So, I put down the mutual fund topic during the rest of my doctoral program, although my interest in funds never waned. Soon after entering the professorate in 1993, I restarted my formal research on mutual funds. That research continues to this day.
While I had suspicions in 1990 that mutual funds would become an interesting and important topic, I did not even come close to imagining then what has actually happened in the mutual fund universe over the nearly two decades since my first research effort as a doctoral student. At the time of my first study, there were a few hundred open-end mutual funds that held about $1 ...

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