PT - JOURNAL ARTICLE AU - Gerald Abdesaken TI - Following the Followers: <em>Mutual Fund Performance When Managers Follow Analyst Coverage</em> AID - 10.3905/jii.2018.9.1.036 DP - 2018 May 31 TA - The Journal of Index Investing PG - 36--48 VI - 9 IP - 1 4099 - https://pm-research.com/content/9/1/36.short 4100 - https://pm-research.com/content/9/1/36.full AB - 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