Approaches to mutual funds selection: the importance of an appropriate selection process

Abstract

After years of contrasting opinions, financial literature is converging to the conviction that, in funds selection, a study based on both quantitative and qualitative analysis allows to build portfolios that produce higher performances than adopting only one of these approaches. Studying some factitious portfolios, obtained from the investible universe of mutual funds of a small Italian asset management company, this research confirms this conclusion. Moreover, through the introduction of an ESG filter to the first part of the analysis, the statement that counting for values and ethics in portfolio construction enhances the performance of financial products is validated