Women in fund management: Where are the equal opportunities?

Women in fund management: Where are the equal opportunities?

The representation of women in fund management remains alarmingly low in Germany. A current study by researchers at University of Mannheim examines how gender distribution influences investment behavior and shows significant differences between male and female fund managers. The analysis considers data from 2003 to 2019 and shows that women in the fund industry tend to make higher investments in healthcare, while male colleagues are more likely to be active in the energy sector.

One of the central findings of the study is the newly introduced “Portfolio Masculinity Index”. It rates funds based on their gender-specific investment behavior. Research shows that funds classified as “masculine” tend to correlate with poorer performance. This discrepancy is particularly notable considering that only 9% of fund managers in the US are female and women manage only about 3% of net fund assets.

Low presence of women

The survey of the Morningstar has shown that only 3% of actively managed funds in Germany are managed by women. Not only are these numbers worrying, they also highlight the progress that still needs to be made. While the proportion of funds with a mixed team was 9.73% in 2023, women only manage just under 2% of the total assets under management.

A significant trend in the industry is the increasing management by mixed teams rather than individual fund managers. Nevertheless, the analysis shows that 55% of funds prefer a team approach, but 26% of funds with mixed teams are led by a male manager. This creates an unequal distribution and prevents women from taking on a stronger role.

International context and challenges

In a global comparison, Germany performs poorly. According to the Citywire database With just 7%, German female fund managers take 21st place out of 24 in the global ranking. Countries like Taiwan and Hong Kong fare significantly better, with female representation at 29% and 28% respectively. Despite positive developments, such as the almost threefold increase in mixed management teams in Germany since 2016, the proportion of female fund managers remains disproportionately low.

The reasons for this unequal distribution are complex. A lack of transparency at fund houses makes it difficult to evaluate gender distribution, and the trend towards teamwork could increase opportunities for women, but is often overshadowed by the dominance of male managers.

In summary, the fund industry needs to take urgent action to promote gender diversity. More women in the funds industry could not only change investment behavior, but also direct capital to underrepresented sectors, ultimately leading to a positive economic impact.