Stock Herding among Swedish Mutual Fund Managers

Abstract: The study uses new holding data from 93 Swedish equity funds with 78 distinct mutual fund managers to examine stock herding behaviour in Sweden. High levels of fund manager herding is found in the average stock when employing the method developed by Lakonishok et al. (1992). A smaller market capitalization for a stock predicts a higher herding measure for that stock. The industry with the highest herding is Oil & Gas. There is no evidence of cyclical changes in herding among fund managers. The extent of herding in Sweden is closer to that of emerging countries than to the U.S. and other mature financial markets.