Are some mutual fund managers better than others? cross-sectional patternsin behavior and performance

We examine whether mutual fund performance is related to characteristics of fund managers that may indicate ability, knowledge, or effort. In particul ar, we study the relationship between performance and the manager's age, th e average composite SAT score at the manager's undergraduate institution, a nd whether the manager has an MBA. Although the raw data suggest striking r eturn differences between managers with different characteristics, most of these can be explained by behavioral differences between managers and by se lection biases. After adjusting for these, some performance differences rem ain. In particular, managers who attended higher-SAT undergraduate institut ions have systematically higher risk-adjusted excess returns.