Abstract
We investigate if the perceived attractiveness of mutual fund managers influences mutual fund flows. We hand-collect professional photographs of managers and use machine learning algorithms to develop two objective proxies of attractiveness. We find that, after controlling for fund characteristics, performance measures and manager characteristics, mutual funds managed by ‘attractive’ managers receive higher fund flows. Our results are robust to matched sample analysis, Heckman two-stage selection, alternate model specifications. Attractiveness bias is predominantly witnessed within retail investors and does not entail superior fund performance. Our results suggest that mutual fund investors exhibit a bias for seemingly attractive mutual fund managers.
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