The relation between mutual fund flows, stock returns and macroeconomic variables: evidence from Portugal

Júlio Lobão, André Levi


In this article we analyze the relations between mutual fund flows, stock market returns and macroeconomic variables during the period 2000-2012 inPortugal. We found evidence of a statistically significant positive co-movement between mutual fund flows and stock market returns which is consistent with a common reaction to information about future economic activity. Moreover, our results suggest that both mutual fund flows and stock market returns are forward-looking and help to forecast the evolution of macroeconomic variables. These results have relevant implications for all the decision-makers that need to forecast economic activity.


Mutual fund flows; stock returns; future economic activity; macroeconomic variables

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Portuguese Journal of Finance, Management and Accounting

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