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Recent studies of mutual funds have all arrived at the same conclusion: mutual fund performance has been inferior to the performance of the market indices. One of the most prominent of these studies was conducted by William F. Sharpe. He showed that if his measure of mutual fund performance, the reward-to-variability ratio, is calculated net of management expenses for each fund in his sample of thirty-four, then the average value of this ratio over the thirty-four funds is significantly less than the same measure applied to the Dow Jones Industrials over the 1954–1963 period. From this evidence, Sharpe concluded that average mutual fund performance was distinctly inferior to an investment in the Dow Jones Industrial Average. It is the intent of this paper to show that if another variable, namely the third moment of the fund's annual rate of return, is introduced into the investor's decision process, Sharpe's conclusion must be altered.
An examination of the manuscript censuses of manufacturing in 1850 and 1860 indicates the forthcoming revision of many traditional interpretations of American industrial development. This study suggests that large-scale manufacturing in the South and West was quite similar in the decade before the Civil War and that antebellum manufacturing was sufficiently concentrated to imply that the model of perfect competition is as inappropriate a description of mid-nineteenth century industrial structure as it is of twentieth century industry.