IMPACT OF TAX-BURDEN ON MUTUAL FUNDS PERFORMANCE

Abstract

This study investigated association between tax-burden and mutual funds performance from both a theoretical and an empirical perspective. The results of this study show that the performance of Pakistani mutual open ended funds is related to their tax burden. And also tax-efficient funds have better performance due to favorable investment style, lower trading costs, and better selection of stocks. This study analyzed the data of 211 Pakistani open ended mutual funds from 2014 to 2017. The results provide current mutual funds performance analysis, which is useful for individual investors, institutional investors and asset management companies. The fund managers can also get help from this research while watching investors as well as funds own interests.