Current trends in performance and flows in the Spanish pension funds industry

This paper provides an analysis of Spanish individual pension funds’ financial performance.The evidence presented shows that, like in other investment fund markets around the world, on average individual pension funds do not provide investors with positive risk adjusted returns after subtracting fees. Nevertheless, there is evidence of fund manager skill since, on average, risk adjusted returns before fees are positive and there is persistence in the risk adjusted performance of funds. Additionally, there is evidence that Spanish households respond to fund performance by moving funds to well managed funds.