In this study, I compare the fund selection criteria used by investors in retail mutual funds with the criteria of investors in institutional mutual funds. I show several differences in investment flow patterns between retail and institutional funds, which are consistent with differences in...

Do sophisticated investors exhibit a stronger “smart money” effect than unsophisticated ones? In this paper, I examine whether fund selection ability of institutional mutual fund investors is better than that of retail mutual fund investors. In line with the studies of Gruber (1996), Zheng...