TY  - BOOK
AU  - Opazo,Luis
AU  - Opazo,Luis
AU  - Raddatz,Claudio
AU  - Schmukler,Sergio L.
TI  - Institutional Investors and Long-Term Investment: Evidence from Chile 
PY  - 2014///
CY  - Washington, D.C.
PB  - The World Bank
KW  - Capital Markets
KW  - Debt Markets
KW  - Debt Maturity
KW  - Deposit Insurance
KW  - Emerging Markets
KW  - Finance and Financial Sector Development
KW  - Institutional Investors
KW  - Insurance Industry
KW  - Long-Term Finance
KW  - Maturity Structure
KW  - Mutual Funds
KW  - Non Bank Financial Institutions
KW  - Pension Funds
KW  - Private Sector Development
N2  - Developing countries are trying to develop long-term financial markets and institutional investors are expected to play a key role. This paper uses unique evidence on the universe of institutional investors from the leading case of Chile to study to what extent mutual funds, pension funds, and insurance companies hold and bid for long-term instruments, and which factors affect their choices. The paper uses monthly asset-level portfolios to show that, despite the expectations, mutual and pension funds invest mostly in short-term assets relative to insurance companies. The significant difference across maturity structures is not driven by the supply side of debt or tactical behavior. Instead, it seems to be explained by manager incentives (related to short-run monitoring and the liability structure) that, combined with risk factors, tilt portfolios toward short-term instruments, even when long-term investing yields higher returns. Thus, the expansion of large institutional investors does not necessarily imply longer-term markets
UR  - http://elibrary.worldbank.org/doi/book/10.1596/1813-9450-6922
ER  -