JOURNAL OF ACCOUNTING AND FINANCE
Portfolio Liquidity and Share Turnover of Closed-end Mutual Funds
Author(s): Charles Cullinan, Xiaochuan Zheng, Elena Precourt
Citation: Charles Cullinan, Xiaochuan Zheng, Elena Precourt, (2018) "Portfolio Liquidity and Share Turnover of Closed-end Mutual Funds", Journal of Accounting and Finance, Vol. 18, ss. 6, pp. 43-56
Article Type: Research paper
Publisher: North American Business Press
Abstract:
We examine the relationship between the liquidity of the portfolios of closed-end mutual funds and the
share turnover of closed-end funds’ shares. We find that the portfolio liquidity/share turnover
relationship is contingent upon the nature of the funds’ shareholders. For funds with mainly smaller
shareholders, there is a negative relationship between portfolio liquidity and share turnover, suggesting
that smaller investors are more likely to hold shares of these funds to avoid the transaction costs
associated with trading. However, as more institutional investors hold fund shares, portfolio liquidity is
positively associated with share turnover.