Investment Consultants’ Claims About Their Own Performance: What Lies Beneath?

Cookson, Gordon, Jenkinson, Tim, Jones, Howard and Martinez, Jose Vicente (2018) Investment Consultants’ Claims About Their Own Performance: What Lies Beneath? Working Paper.

[img]
Preview
PDF
Download (934kB) | Preview

Abstract

Investment consultants market their services by claiming that their fund manager recommendations add significant value. Using detailed data from the leading investment consultants we find no such evidence. A forensic analysis of consultants’ disclosures reveals a number of practices that explain their claims: comparisons to benchmarks rather than to peers, inclusion of simulated and backfilled returns, use of rating survivorship conditions, and unexplained exclusions of products from the analysis. We find that recommended products have similar return and risk characteristics to products that are not recommended, but deviate less from their benchmarks.

Item Type: Other Working Paper
Keywords: Investment consultants, recommendations, institutional asset managers, voluntary performance disclosures, finance
Subject(s): Finance
Date Deposited: 23 Jul 2018 08:43
Last Modified: 09 Aug 2018 08:34
Funders: N/A
URI: http://eureka.sbs.ox.ac.uk/id/eprint/6876

View statistics

Actions (login required)

Edit View Edit View