Mutual funds managed by women have outperformed funds managed by men this year and are more likely to have withstood market swings, according to data compiled by Goldman Sachs.
Forty three per cent of women-managed funds have outperformed their benchmark this year, compared with 41 per cent of those managed by men.
“Even after adjusting for risk, female-managed funds have outperformed their counterparts amid the pandemic-related market swings,” David Kostin, a Goldman Sachs strategist wrote to clients.
To qualify as women-managed in the report, at least one-third of manager positions must be held by women.
The analysis from Goldman Sachs also highlighted just how underrepresented female led funds are. Of the 496 large-cap US mutual funds analysed by Goldman Sachs, with a combined value of $2.3 trillion in assets managed, only 63 funds or 13 per cent, qualified as women-managed. There are $261 billion worth of assets managed in these funds.
Just 14 of the 496 funds had all-women management teams, making up 3 per cent, compared with 380, or 77 per cent, with all-male management teams.
“Female-managed funds withstood many of the market swings, with the median fund outperforming its benchmark by 50 [basis points] from the start of the year to March 23rd. On the other hand, the typical fund with no women managers lagged its benchmark by 20 [basis points] during that period,” Kostin wrote.
“Since the market trough, 48% of female-managed funds have generated alpha, compared with only 37% of all-male funds.”
The findings relating to gender mark a divergence from the previous few years, where performance between funds managed by men and women were largely level. According to Goldman Sachs, greater exposure to technology stocks has given women-managed funds an advantage during the pandemic.