Article Dans Une Revue Journal of banking & finance = Journal of banking and finance Année : 2023

Scale and skills in European active management: Impact of a new regulatory context

Résumé

This study examines the impact of a new regulatory context on the dynamics and nature of returns to scale in European active management. Using a sample of 1325 actively managed European equity funds and following Pastor, Stambaugh, and Taylor’s model from 2015, we find strong evidence of industry-level decreasing returns to scale. We also find that the new regulatory context creates structural breaks in the optimal scale that significantly change the size-performance relationship. We find strong support that emerging and small-cap funds allow increasing returns to scale. We find evidence that fund families play a moderating role in decreasing returns to scale. Further, the results show a significant upward trend in fund skills evolution.

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hal-04197518 , version 1 (01-10-2025)

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Veasna Khim, Hery Razafitombo. Scale and skills in European active management: Impact of a new regulatory context. Journal of banking & finance = Journal of banking and finance, 2023, 154, pp.106963. ⟨10.1016/j.jbankfin.2023.106963⟩. ⟨hal-04197518⟩
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