PT  - JOURNAL ARTICLE
AU  - K. Vaidyanathan
TI  - The 80–20 Rule of Mutual Fund Families in the U.S.
AID  - 10.3905/jii.2011.2.3.082
DP  - 2011 Nov 30
TA  - The Journal of Index Investing
PG  - 82--92
VI  - 2
IP  - 3
4099  - https://pm-research.com/content/2/3/82.short
4100  - https://pm-research.com/content/2/3/82.full
AB  - This article provides empirical evidence that the levels of assets under management of mutual fund families in the U.S. closely follow a Pareto distribution. The author demonstrates theoretically that this can happen only if the large fund families have non-distinct investment skills and proves that heterogeneous investment talents among the large funds would lead to a non-Pareto distribution. The empirical assets under management distribution suggests that funds face similar return distributions, which leads to the conclusion that either “bargains” do not exist or every fund has an equal probability of getting a “bargain.”TOPICS: Mutual fund performance, performance measurement, portfolio construction