Gender, style diversity, and their effect on fund performance

Abstract

a b s t r a c tThis paper examines the performance of 358 European diversified equity mutual funds controlling for gender diversity. Fund performance is evaluated against funds' designated market indices and representative style portfolios. Consistently with previous studies, proper statistical tests point to the absence of significant differences in performance and risk between female and male managed funds. However, perverse market timing manifests itself mainly in female managed funds and in the left tail of the returns distribution. Interestingly, at fund level there is evidence of significant overperformance that survives even after accounting for funds' exposure to known risk factors. Employing a quantile regression approach reveals that fund performance is highly dependent on the selection of the specific quantile of the returns distribution; also, style consistency for male and female managers manifests itself across different quantiles. These results have important implications for fund management companies and for retail investors' asset allocation strategies.

Learning about individual managers’ performance in UK pension funds: The importance of specialization

“…Additionally, we examine whether managers with specific characteristics (managerial attributes) outperform their competitors. Different works relate fund performance with managerial attributes, such as tenure and age (Korniotis and Kumar 2011), gender (Dwyer et al 2002;Watson and McNaughton 2007;Babalos et al 2015), fund type under management (Custodio et al 2013;Zambrana and Zapatero 2016), or a variety of these (Gottestman and Morey 2006;Fang and Wang 2015). These previous works find that performance is affected by managerial traits, but the relation between them is not clear.…”

The effect of corporate governance on financial performance of rural banks in Ghana

“…Carter et al (2010) conducted a similar study in the United States but reported an insignificant association between gender diversity and firm performance. Some studies did not also report any association between gender diversity and firm performance (Babalos et al 2015;Wachudi & Mboya, 2016;Musah et al 2019). Marinova et al (2010) examined gender diversity and firm performance in the Netherlands and Denmark and reported no significant relationship between gender diversity and firm performance.…”

Manager’s gender and professional credentials in the performance of Polish investment funds

“…Studies dedicated to the European market are scarce in the relevant literature mainly due to the fact that the number of women in the industry is still marginal. From among the few existing works, one by Babalos, Caporale, & Philippas (2015), who analysed the results of 358 equity funds from France, Germany, Italy, and Spain operating in the period 2006-2011, deserves attention. They revealed that gender did not influence fund performance and women were not more risk averse than men.…”

“…In other cases, they were team members. For the sake of comparison, Atkinson, Baird, & Frye (2003) reported a 5.6% share of women in their sample, in the study by Niessen-Ruenzi & Ruenzi (2013) women constituted 10%, while Babalos, Caporale, & Philippas (2015) performed their analysis with a 16.5% share of female professionals. To conclude, we decided to group funds into those (co-)managed by women and those hiring only men to manage portfolios in order to capture the aspects of femininity and gender diversity.…”