Abstract
This study examines the effect of investment fund managers' characteristics in the form of tenure, and mutual fund characteristics with proxy turnover portfolios, market timing and stock selectivity on the performance of stock mutual funds. The research sample is 27 stock mutual funds in Indonesia that were active from 2013 to 2017. On the analysis of the relationships between the characteristics of investment managers and mutual funds characteristics on the performance of stock mutual funds, a series of OLS regressions were run. The panel data regression was included based on using the Eviews. All of the above were aimed at achieving portfolio optimization and realizing the maximization of the interests for fund management companies and investors. The main findings are as follows. Tenure does not affect the performance of stock mutual funds during the years 2013 to 2017, but if divided into 2 quadrants of tenure, namely tenure over 19 years and tenure under 19 years of work, the result is that tenure over 19 years has a positive effect on the performance of stock mutual funds, but tenure brought 19 years has no effect on the performance of equity funds, whereas mutual funds characteristics, which are proxied by portfolio turnover, market timing and stock selectivity, have a significant positive effect on the performance of equity funds in Indonesia. The primary limitation in the scope is the sample, because stock mutual funds that publish consistently Financial statements between 2013 and 2017 are few in number. These findings have important implications for fund management companies as input material that the investment strategy of the investment management team affects the performance of equity funds compared to the characteristics of investment managers with proxies for years of service. This paper proposes a new perspective to evaluate the relationship between the fund manager and mutual funds characteristicsanddivide 2 groups of working years, and calculate them with non-linear models.
Highlights
The development of the mutual fund industry in Indonesia is increasing in line with the development of investment in the capital market and the growth of the Indonesian economy
Based on the calculation through path analysis done by using eviews which covers mutual funds performance, tenure, turnover portfolio, market timing and stock selectivity
The results showed that there was no influence of the tenure period with the performance of equity funds in Indonesia from 2013 to 2017
Summary
The development of the mutual fund industry in Indonesia is increasing in line with the development of investment in the capital market and the growth of the Indonesian economy. Indonesia is a weak efficiency market (Lubis and Ismail 2010), so there is still information in the market that is not well publicized This provides an opportunity for investors to obtain abnormal returns by applying the right investment strategy. Mutual fund investment strategies consist of portfolio turnover, market timing and stock selectivity. Portfolio turnover, market timing and stock selectivity are inconsistent in increasing mutual fund performance. This study will examine the fund manager's tenure that affects mutual fund performance and investment strategies that improve mutual fund performance, with investment strategies proxied as portfolio turnover, market timing and stock selectivity. The results of the study of the influence of investment strategies with portfolio turnover proxy, market timing and stock selectivity have a significant effect on the performance of equity funds in Indonesia
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