10b28a6781733c7b5e4b00f4722926fa 10.3934_QFE.2025020.pdf 4205ce9cb765668cb38272cebbd05635b3ce6382 10.3934_QFE.2025020.pdf 9266500c2742b1c94bd06588b6cf82af2ff2c242cebfd0c05f2a987be6ea6cf3 10.3934_QFE.2025020.pdf Title: Fund performance—flow relationship for microfinance mutual funds Subject: Mutual funds could contribute to sustainable development by investing in microfinance institutions that provide microloans to microfirms with difficulties accessing financial services, such as loans, savings, and insurance from traditional banks. To increase their assets and support microfinance institutions, fund managers need to understand the factors that investors use to make their investment decisions. For microfinance investors, fund financial attributes could signal that microfinance institutions provide support to microentrepreneurs that improve their corporate financial performance. This would satisfy the social preferences of fund investors. Therefore, our research question is: Are investors considering past financial performance to select one specific microfinance mutual fund? To answer this question, we analysed the behaviour of microfinance mutual fund investors regarding past financial performance in different states of the economy. To this end, we collected information on 65 microfinance mutual funds domiciled in Austria, Japan, Liechtenstein, and Luxembourg. These mutual funds invested in global or emerging global markets from 2015 to 2021. For this sample, we implemented Petersen’s method, which clusters standard errors by fund and year. These results indicated that microfinance mutual fund investors consider high annual raw returns, fund age, and ethical certifications when making investment decisions and withdrawing money from them during crises such as the COVID-19 pandemic. Conversely, microfinance fund investors do not react to past risk-adjusted returns, total risk, fund size, fund expenses, or fund flows. Keywords: investors’ behaviour; microfinance mutual funds; financial performance; ethical; COVID-19 Author: Carmen-Pilar Martí-Ballester1 Creator: PScript5.dll Version 5.2.2 Producer: Acrobat Distiller 10.0.0 (Windows) CreationDate: Wed Jul 30 04:04:17 2025 CEST ModDate: Wed Jul 30 04:08:16 2025 CEST Custom Metadata: no Metadata Stream: yes Tagged: no UserProperties: no Suspects: no Form: none JavaScript: no Pages: 29 Encrypted: no Page size: 595.22 x 842 pts (A4) Page rot: 0 File size: 521192 bytes Optimized: no PDF version: 1.4 name type encoding emb sub uni object ID ------------------------------------ ----------------- ---------------- --- --- --- --------- ECKJEP+TimesNewRomanPSMT CID TrueType Identity-H yes yes yes 131 0 ECKJHB+TimesNewRomanPS-BoldItalicMT TrueType WinAnsi yes yes no 132 0 ECKJHC+TimesNewRomanPS-BoldMT CID TrueType Identity-H yes yes yes 133 0 ECKJNA+Calibri CID TrueType Identity-H yes yes yes 97 0 ECKJPC+TimesNewRomanPS-ItalicMT TrueType WinAnsi yes yes no 101 0 ECKJPD+Arial-BoldMT CID TrueType Identity-H yes yes yes 105 0 ECKMGF+ArialMT CID TrueType Identity-H yes yes yes 106 0 ECKOLH+Cambria CID TrueType Identity-H yes yes yes 108 0 ECLAJN+SimSun CID TrueType Identity-H yes yes yes 113 0 Jhove (Rel. 1.28.0, 2023-05-18) Date: 2025-09-04 03:10:57 CEST RepresentationInformation: 10.3934_QFE.2025020.pdf ReportingModule: PDF-hul, Rel. 1.12.4 (2023-03-16) LastModified: 2025-09-03 04:01:41 CEST Size: 521192 Format: PDF Version: 1.4 Status: Well-Formed and valid SignatureMatches: PDF-hul MIMEtype: application/pdf PDFMetadata: Objects: 158 FreeObjects: 2 IncrementalUpdates: 2 DocumentCatalog: PageLayout: SinglePage PageMode: UseNone Info: Title: Fund performance flow relationship for microfinance mutual funds Author: Carmen-Pilar Martí-Ballester1 Subject: Mutual funds could contribute to sustainable development by investing in microfinance institutions that provide microloans to microfirms with difficulties accessing financial services, such as loans, savings, and insurance from traditional banks. To increase their assets and support microfinance institutions, fund managers need to understand the factors that investors use to make their investment decisions. For microfinance investors, fund financial attributes could signal that microfinance institutions provide support to microentrepreneurs that improve their corporate financial performance. This would satisfy the social preferences of fund investors. Therefore, our research question is: Are investors considering past financial performance to select one specific microfinance mutual fund? To answer this question, we analysed the behaviour of microfinance mutual fund investors regarding past financial performance in different states of the economy. To this end, we collected information on 65 microfinance mutual funds domiciled in Austria, Japan, Liechtenstein, and Luxembourg. These mutual funds invested in global or emerging global markets from 2015 to 2021. For this sample, we implemented Petersen’s method, which clusters standard errors by fund and year. These results indicated that microfinance mutual fund investors consider high annual raw returns, fund age, and ethical certifications when making investment decisions and withdrawing money from them during crises such as the COVID-19 pandemic. Conversely, microfinance fund investors do not react to past risk-adjusted returns, total risk, fund size, fund expenses, or fund flows. Keywords: investors’ behaviour; microfinance mutual funds; financial performance; ethical; COVID-19 Creator: PScript5.dll Version 5.2.2 Producer: Acrobat Distiller 10.0.0 (Windows) CreationDate: Wed Jul 30 04:04:17 CEST 2025 ModDate: Wed Jul 30 04:08:16 CEST 2025 ID: 0x0238937ad43604955eaccf4a07faf0a7, 0xb513e47b4aa22c4896d28d07b4a52af0 Filters: FilterPipeline: FlateDecode FilterPipeline: DCTDecode Images: Image: NisoImageMetadata: FormatName: image/jpg CompressionScheme: JPEG ImageWidth: 884 ImageHeight: 217 ColorSpace: RGB BitsPerSample: 8 BitsPerSampleUnit: integer Image: NisoImageMetadata: FormatName: image/jpg CompressionScheme: JPEG ImageWidth: 583 ImageHeight: 166 ColorSpace: RGB BitsPerSample: 8 BitsPerSampleUnit: integer Fonts: Type0: Font: BaseFont: ECKJNA+Calibri Encoding: Identity-H ToUnicode: true Font: BaseFont: ECLAJN+SimSun Encoding: Identity-H ToUnicode: true Font: BaseFont: ECKJEP+TimesNewRomanPSMT Encoding: Identity-H ToUnicode: true Font: BaseFont: ECKJHC+TimesNewRomanPS-BoldMT Encoding: Identity-H ToUnicode: true Font: BaseFont: ECKJPD+Arial-BoldMT Encoding: Identity-H ToUnicode: true Font: BaseFont: ECKMGF+ArialMT Encoding: Identity-H ToUnicode: true Font: BaseFont: ECKOLH+Cambria Encoding: Identity-H ToUnicode: true TrueType: Font: BaseFont: ECKJHB+TimesNewRomanPS-BoldItalicMT FontSubset: true FirstChar: 32 LastChar: 116 FontDescriptor: FontName: ECKJHB+TimesNewRomanPS-BoldItalicMT Flags: Serif, Nonsymbolic, Italic FontBBox: -547, -307, 1401, 1032 FontFile2: true Encoding: WinAnsiEncoding Font: BaseFont: ECKJPC+TimesNewRomanPS-ItalicMT FontSubset: true FirstChar: 32 LastChar: 122 FontDescriptor: FontName: ECKJPC+TimesNewRomanPS-ItalicMT Flags: Serif, Nonsymbolic, Italic FontBBox: -498, -307, 1333, 1023 FontFile2: true Encoding: WinAnsiEncoding CIDFontType2: Font: BaseFont: ECLAJN+SimSun CIDSystemInfo: Registry: Adobe Registry: Identity Supplement: 0 FontDescriptor: FontName: ECLAJN+SimSun Flags: Serif, Symbolic FontBBox: -8, -141, 1000, 859 FontFile2: true Font: BaseFont: ECKJEP+TimesNewRomanPSMT CIDSystemInfo: Registry: Adobe Registry: Identity Supplement: 0 FontDescriptor: FontName: ECKJEP+TimesNewRomanPSMT Flags: Serif, Symbolic FontBBox: -568, -307, 2046, 1040 FontFile2: true Font: BaseFont: ECKMGF+ArialMT CIDSystemInfo: Registry: Adobe Registry: Identity Supplement: 0 FontDescriptor: FontName: ECKMGF+ArialMT Flags: Symbolic FontBBox: -665, -325, 2000, 1040 FontFile2: true Font: BaseFont: ECKJNA+Calibri CIDSystemInfo: Registry: Adobe Registry: Identity Supplement: 0 FontDescriptor: FontName: ECKJNA+Calibri Flags: Symbolic FontBBox: -503, -313, 1240, 1026 FontFile2: true Font: BaseFont: ECKJPD+Arial-BoldMT CIDSystemInfo: Registry: Adobe Registry: Identity Supplement: 0 FontDescriptor: FontName: ECKJPD+Arial-BoldMT Flags: Symbolic FontBBox: -628, -376, 2000, 1056 FontFile2: true Font: BaseFont: ECKJHC+TimesNewRomanPS-BoldMT CIDSystemInfo: Registry: Adobe Registry: Identity Supplement: 0 FontDescriptor: FontName: ECKJHC+TimesNewRomanPS-BoldMT Flags: Serif, Symbolic FontBBox: -558, -328, 2000, 1056 FontFile2: true Font: BaseFont: ECKOLH+Cambria CIDSystemInfo: Registry: Adobe Registry: Identity Supplement: 0 FontDescriptor: FontName: ECKOLH+Cambria Flags: Serif, Symbolic FontBBox: -1475, -2464, 2868, 3117 FontFile2: true XMP: 2025-07-30T10:04:17+08:00 PScript5.dll Version 5.2.2 2025-07-30T10:08:16+08:00 2025-07-30T10:08:16+08:00 Acrobat Distiller 10.0.0 (Windows) investors’ behaviour; microfinance mutual funds; financial performance; ethical; COVID-19 application/pdf Fund performance—flow relationship for microfinance mutual funds Carmen-Pilar Martí-Ballester1 * and Buket Erden2 Mutual funds could contribute to sustainable development by investing in microfinance institutions that provide microloans to microfirms with difficulties accessing financial services, such as loans, savings, and insurance from traditional banks. To increase their assets and support microfinance institutions, fund managers need to understand the factors that investors use to make their investment decisions. For microfinance investors, fund financial attributes could signal that microfinance institutions provide support to microentrepreneurs that improve their corporate financial performance. This would satisfy the social preferences of fund investors. Therefore, our research question is: Are investors considering past financial performance to select one specific microfinance mutual fund? To answer this question, we analysed the behaviour of microfinance mutual fund investors regarding past financial performance in different states of the economy. To this end, we collected information on 65 microfinance mutual funds domiciled in Austria, Japan, Liechtenstein, and Luxembourg. These mutual funds invested in global or emerging global markets from 2015 to 2021. For this sample, we implemented Petersen’s method, which clusters standard errors by fund and year. These results indicated that microfinance mutual fund investors consider high annual raw returns, fund age, and ethical certifications when making investment decisions and withdrawing money from them during crises such as the COVID-19 pandemic. Conversely, microfinance fund investors do not react to past risk-adjusted returns, total risk, fund size, fund expenses, or fund flows. investors’ behaviour microfinance mutual funds financial performance ethical COVID-19 © 2025 the Author(s), licensee AIMS Press. 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