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A Structural Model of Dynamic Market Timing

Jérôme Detemple; Marcel Rindisbacher

Boston University

Review of Financial Studies 2013

This paper derives and analyzes dynamic timing strategies of a fund manager with private information. Endogenous timing strategies generated by various information structures and skills, and associated fund styles, are identified. Endogenous fund returns are characterized in the public information of an uninformed observer. Timing components are identified. The paper provides foundations for regression analyses of fund returns and tests of market timing.

DOI
10.1093/rfs/hht028
Volume
26 (10)
Pages
2492-2547
Language
en
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Sources
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