Document Type

Article

Publication Date

2017

Publication Title

Journal of Accounting and Finance

Abstract

Interest in governance led Morningstar to develop a summary measure for mutual fund governance. In contrast to previous work in this area, we focus on whether and how individual investors can use the Stewardship Grade Overall to improve mutual fund selection. We find that regardless of fee structure, top overall governance grade funds impose lower costs on investors regardless of fund investment style. We also find some evidence that choosing funds with the highest stewardship grade may earn positive risk adjusted returns. Stewardship Grade overall may therefore help less sophisticated investors identify better-performing mutual funds.

Creative Commons License

Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License
This work is licensed under a Creative Commons Attribution-Noncommercial-No Derivative Works 4.0 License.

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