Women in a Man’s World: The Impact of Gender on Mutual Fund Behavior, Performance, and Market Response

Abstract

Over the past ten years, female representation in the U.S. mutual fund industry has stagnated: while 70% of funds are run by all-male teams, less than 2% are run by all-female teams, and the only growth in female participation has occurred in mixed-gender teams. In this paper, I investigate the relationship between gender and mutual fund behavior, performance, and market response in order to determine whether female underrepresentation in the space can be characterized as a demand or a supply issue. I find that female managers gravitate toward larger, more expensive funds with lower turnover ratios and that manager gender does not significantly predict a fund’s monthly returns or capital flow. The gender differentials that are present imply that problems exist on both the demand and supply sides of the labor market for female mutual fund managers.