Women may only account for a fraction of U.S. mutual fund managers, but they have delivered returns similar to funds that lack women managers, according to the Goldman Sachs’ report “2020 U.S. Equity Outlook: United We Fall, Divided We Wise.”

As the paper notes, “While women have voted for a century, their progress in the labor force has been uneven.” The Goldman analysis found that 40% of all employees at U.S.-headquartered S&P 500 companies were women, but “they account for only 5% of CEOs and 21% of directors.”

Drilling down into the mutual fund industry, the skew is similar. Of the 528 large-cap mutual funds analyzed by Goldman, only 15, or 3%, have all-female fund manager teams and collectively have 1% of total assets. In comparison, 409 teams — or 77% — have all-male teams and control 64% of assets.

With this in mind, Goldman analyzed how the large-cap mutual funds with women making up at least a third of the portfolio management team performed vs. overall funds.

The firm found that only 73, or 14%, of the 528 large-cap U.S. mutual funds with are “female managed.” Further, of the $2.5 trillion of AUM, female managed funds have only 18% of AUM, or $196 billion.

However, during the past three years, “female managed funds have delivered similar hit rates of outperformance and risk-adjusted returns compared with all other large-cap mutual funds,” the report said.

In fact, since the beginning of 2017, “an average of 39% of female-managed funds has outperformed its benchmark annually compared with 41% for all other funds.” In addition, return volatility (12) and  Sharpe ratios (2.0) have been “almost identical” across all teams no matter what the makeup.

The paper also notes that on a sector-level, female-managed funds tend to invest more in information technology vs. other large-cap funds.

In fact, the average female-managed fund was 89 basis points overweight information technology, while others were underweight by 39 basis points.

Financials were  the largest sector — overweight 102 bps — for mutual funds with few or no female managers, whereas female managed funds were 88 bps underweight in financials. Female funds also were overweight in utilities and consumer staples.

Female mutual fund managers “display similar tilts as hedge fund managers,” which also are underweight similarly in financials, the study adds. “Female-managed funds tend to tilt toward defensive and high-growth industries,” it stated.

The top five industries for female-managed fund investments are software, pharmaceuticals, electric utilities, internet & direct marketing retail and multi-utilities, while the five lowest industries for investment are healthcare providers and services, capital markets, diversified financial services, media and specialty retail.

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