Female-led funds outperform male-managed funds during pandemic

Female portfolio managers are outperforming those managed by men during the pandemic, says recent Goldman Sachs research. The research examined 496 large-cap US mutual funds with a total of US$2.3 trillion in assets under management.

Key findings include:

• Forty-three per cent of female-managed funds outperformed their benchmark year to date versus 41 per cent managed by men after adjusting for risk, with women-led funds faring better in market turbulence

• Female-led mutual funds, when taking the median, are behind its benchmark by just 60bps year-to-date, while funds without women at the helm are behind by 160bps.

Female-managed portfolios were defined as women holding at least a third of portfolio manager positions. Just 14 mutual funds were found to be led by an all-female team, favouring tech stocks like Amazon, Apple, Microsoft and Tesla, while male-managed funds prefer the financials sector.

Female-managed funds tended to have lower allocations to stocks like Berkshire Hathaway, Wells Fargo and Exxon Mobil, with energy and materials sectors less favoured. The median female-managed mutual fund saw somewhat more outflows year-to-date than male-managed funds. The typical female-managed fund saw outflows of -5.7 per cent of assets under management since January 2020, versus -5.5 of the median fund with male managers.

When averaged, female-managed funds look after twice the assets as those funds with only male portfolio managers ($1.1 billion compared with $0.5 billion).