Advertising and Portfolio Choice *

  title={Advertising and Portfolio Choice *},
  author={Henrik Cronqvist},
  • Henrik Cronqvist
  • Published 2006
This paper examines the role that advertising plays in the mutual fund industry and whether advertising affects investors’ fund and portfolio choices. Content analysis shows that only a small fraction of fund advertising is directly informative about characteristics relevant for rational investors, such as fund fees. Higher quantities of advertising do not signal ex ante higher unobservable fund manager ability, because funds that advertise more are not associated with higher post-advertising… CONTINUE READING
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