TY - JOUR T1 - Following the Followers: <em>Mutual Fund Performance When Managers Follow Analyst Coverage</em> JF - The Journal of Index Investing SP - 36 LP - 48 DO - 10.3905/jii.2018.9.1.036 VL - 9 IS - 1 AU - Gerald Abdesaken Y1 - 2018/05/31 UR - https://pm-research.com/content/9/1/36.abstract N2 - Mutual fund managers who adjust portfolio holdings based on analyst coverage and consensus recommendations achieve signi?cantly lower risk-adjusted returns, but perform better than when consensus recommendations are considered alone. In a rational expectations equilibrium setup, an unskilled investor places greater weight on a risky asset’s public signal, given an increase in the asset’s analyst coverage. A new measure of managerial skill based on analyst coverage is formulated and shown to be decreasing in mutual fund alphas.TOPICS: Mutual fund performance, performance measurement ER -