Do fund flow-return relations depend on the type of investor? A research note

Jacquelyn E. Humphrey*, Karen L. Benson, Timothy J. Brailsford

*Corresponding author for this work

Research output: Contribution to journalArticleResearchpeer-review


This study investigates whether the relation between aggregate fund flow and market returns differs between retail and institutional funds. For the retail fund sample, we document a contemporaneous relation between flow and market returns and also find evidence of feedback trading. In contrast, there is little evidence of a relation between flow and market returns for the institutional fund sample. Consequently, it appears that retail and institutional fund investors use different investment strategies, with retail investors following a more naive strategy. We find no evidence of flow inducing price pressure for either type of fund.

Original languageEnglish
Pages (from-to)34-45
Number of pages12
Issue number1
Publication statusPublished - Mar 2013


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