Financial performance of SDG mutual funds focused on biotechnology and healthcare sectors

Carmen Pilar Martí-Ballester*

*Corresponding author for this work

Research output: Contribution to journalArticleResearchpeer-review

10 Citations (Scopus)


Measures favoring healthy lives among populations around the world are essential to reduce social inequalities. Mutual funds could play an important role funding these measures if they are able to attract socially concerned investors by improving their wealth. This study analyzes the financial performance of mutual funds focused on the biotechnology and healthcare sectors related to UN sustainable development goal 3 (SDG 3), comparing their risk-adjusted return with that achieved by conventional mutual funds. This study implements Carhart's multifactor model and Bollen and Busse's timing multifactor model on a sample of 34 biotechnology and 178 healthcare mutual funds and 4352 conventional mutual funds. The results show that biotechnology and healthcare mutual funds perform similarly, while both of them outperform conventional mutual funds. This outperformance of biotechnology and healthcare funds is driven by the superior stock-picking skills of their managers with regards to those of conventional fund managers, while managers of biotechnology, healthcare, and conventional mutual funds present similar poor market timing ability. Mutual funds specialized in biotechnology and healthcare sectors related to sustainable development goal 3 (SDG 3) outperform conventional mutual funds.

Original languageAmerican English
Article number2032
Issue number5
Publication statusPublished - 1 Mar 2020


  • Biotechnology sector
  • Financial performance
  • Healthcare sector
  • Managerial abilities
  • Mutual funds
  • Sustainable development goals


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