According to a new academic study released earlier this week, mutual funds perform better when their directors have significant ownership in the funds they are charged with overseeing.

"While we can't say that ownership by directors directly causes funds to perform well, our results suggest that funds with the right incentive structure in place, one that aligns the interest of the directors with those of shareholders, have better performance," said Martjin Cremers. He is author of the report, "Does Skin in the Game Matter? Director Incentives and Governance in the Mutual Fund" at the Yale School of Management.

Subscribe Now

Access to premium content including in-depth coverage of mutual funds, hedge funds, 401(K)s, 529 plans, and more.

3-Week Free Trial

Insight and analysis into the management, marketing, operations and technology of the asset management industry.