Governance in Mutual Fund Management in Thailand
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Abstract
Mutual Fund industry has a crucial role in fi nancial market development and
is likely to grow steadily. The asset management companies and fund managers
have served as agents and representatives to invest the mutual fund unit
investors’ money in the fi nancial market, with the investors’ expectation of
reasonable yields in return. Thus, trust and confi dence are key success factors to
the sustainable growth of mutual fund industry. The study has pointed out that
there are risks to have the problem of asymmetry information, especially the
moral hazard, in the industry. There are some evidences in the past to show the
occurrence of inappropriate and unethical behaviors in the mutual fund
management in Thailand. Moreover, some structural risks in the industry may lead
to the future occurrence possibility of inappropriate and unethical behaviors. This
study suggests the need to focus on the principles of good governance in the
mutual fund management to reassure the investors’ confi dence to the industry.
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