Women make up less than a tenth of US fund managers but that could change under the coming wealth transfer to females according to the latest magazine from Morningstar, the investment research provider.
Laura Pavlenko Lutton, a director of manager research for Morningstar, said in the report: "More women in the United States are making their own investment decisions than ever before, yet the ranks of professional female fund managers remain exceedingly small. We think shifting demographics may prompt the most change in the fund industry."
Women are under-represented in the US fund industry relative to other professions requiring similar education. For example, 37% of doctors are female and a third of lawyers according to Morningstar.
Morningstar cited a recent study in which 19% of women reported being a primary decision-maker for couples’ long-term retirement savings - twice as many as in 2011. Women now also make up more than a quarter of US final advisors.
By 2020 women are expected to control half of private wealth in the US - $22 trillion of assets - some from inheritances as baby boomers age, but also from growing incomes.
The report said: “Women exclusively run approximately 2% of the industry's assets and open-end funds. By contrast, men exclusively run about 74% of assets and 78% of funds, with mixed-gender teams accounting for the rest.”
There were 7,700 individuals named portfolio managers of US open-end mutual funds on March 31, 2015, including portfolio managers who run funds exclusively and as members of teams. Of these 9.4% are female and women exclusively manage 184 funds.
Dodge & Cox had the highest proportion of female fund managers, 25%, among the largest open-end fund companies by assets under management. Franklin Templeton was next with nearly 15% followed by JPMorgan at approximately 14%.
Lord Abbett was last among the industry's largest firms with just one woman fund manager.
Morningstar said: “Though the sample is relatively small, the performance of exclusively women-run funds rivals that of funds managed by men, even though women tend to manage smaller, pricier funds in niche areas.”
Only 37 women have continuously run a mutual fund for at least a decade through March 31, 2015, and in several cases, those women co-managed with men for at least part of the decade.
The average 10-year category rank for equity funds run by women was virtually the same as for men.
The study said mixed-gender teams provided the best results, though the performance difference between all three groups is narrow.
Morningstar analysed its fund manager database, which includes all of the individuals who managed mutual funds on March 31, 2015, as documented in official filings with the Securities and Exchange Commission. Morningstar assigns each fund manager a numeric identifier so it’s possible to follow the manager’s fund duties throughout his or her career. Morningstar includes biographical attributes about each manager in its database, including gender.
Featured image via okalinichenko/Dollar Photo Club
