探討動機推理對選擇共同基金之影響

Abstract

Retirement planning was previously the responsibility of governments and companies, but that is currently changing. In the United States, most companies have moved or are moving from the traditional fixed benefit retirement plans to fixed contribution plans. The primary investment vehicle of these retirement plans are mutual funds, and their importance is seen in the fact that more than USD $2 trillion from retirement plans were invested in mutual funds. Generally speaking, mutual funds can be divided into two categories: actively managed ones and passively managed funds. Within the passively managed category, there is a subcategory of funds called index funds. Index funds are made to copy the performance of stock exchanges such as the S&P 500. While actively managed funds dominate the mutual fund market, their long term performance has been disappointing. A recent study showed that only 0.6% of actively managed funds could beat the overall market over a 30 year period. While mutual fund performance versus general market performance is an area with a long history of research in the financial community, its results are mostly unknown to the general public. In addition to ignorance, investors often fall victim to motivated reasoning that changes their evaluation of information. A commonly held belief is that that funds which have a recent record of outperforming the market will continue to do so in the future, and so investors look for funds with higher performance. Unfortunately, this popular assumption is false. When the ignorance about actively managed mutual fund performance is combined with mutual fund advertising and investors’ motivated reasoning, the results could be detrimental to retirement planning. However, financial regulations assume that investors are rational and will choose the best option when information is made available to them, but is this prerequisite assumption valid? The purpose of this study is to determine whether people can overcome motivated reasoning and make choices that incorporate newly presented information. The results from this study show that the subjects were unable to make use of the financial information presented to them. The implications of these findings show that changes in mutual fund advertising practice and in investor education should be implemented to protect investors in the new world of retirement planning.

Retirement planning was previously the responsibility of governments and companies, but that is currently changing. In the United States, most companies have moved or are moving from the traditional fixed benefit retirement plans to fixed contribution plans. The primary investment vehicle of these retirement plans are mutual funds, and their importance is seen in the fact that more than USD $2 trillion from retirement plans were invested in mutual funds. Generally speaking, mutual funds can be divided into two categories: actively managed ones and passively managed funds. Within the passively managed category, there is a subcategory of funds called index funds. Index funds are made to copy the performance of stock exchanges such as the S&P 500. While actively managed funds dominate the mutual fund market, their long term performance has been disappointing. A recent study showed that only 0.6% of actively managed funds could beat the overall market over a 30 year period. While mutual fund performance versus general market performance is an area with a long history of research in the financial community, its results are mostly unknown to the general public. In addition to ignorance, investors often fall victim to motivated reasoning that changes their evaluation of information. A commonly held belief is that that funds which have a recent record of outperforming the market will continue to do so in the future, and so investors look for funds with higher performance. Unfortunately, this popular assumption is false. When the ignorance about actively managed mutual fund performance is combined with mutual fund advertising and investors’ motivated reasoning, the results could be detrimental to retirement planning. However, financial regulations assume that investors are rational and will choose the best option when information is made available to them, but is this prerequisite assumption valid? The purpose of this study is to determine whether people can overcome motivated reasoning and make choices that incorporate newly presented information. The results from this study show that the subjects were unable to make use of the financial information presented to them. The implications of these findings show that changes in mutual fund advertising practice and in investor education should be implemented to protect investors in the new world of retirement planning.