Mutual Fund Trading and ESG Clientele

Rui A. Albuquerque, Yrjo Koskinen, Raffaele Santioni

2023 | Academic | Funds, Investor Behavior

Using monthly holdings data and the COVID-19 market crash as a quasi-natural experiment, we find that ESG funds maintained a stable share of their portfolio in ESG stocks in response to fund outflows during the crash. In contrast, conventional funds, who experienced outflows the most, increased their net sales to flows for ESG and non-ESG stocks.