Performance of unit trusts managed by females versus those managed by their male counterparts in South Africa
Date
2017
Authors
Archary, Nirissa
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Abstract
The South African financial system is known to be amongst the most sophisticated and fundamentally sound in the world. This research looks at the role of gender within the unit trust industry of the South African financial market and the influence of a fund manager’s gender on the performance of the unit trust.
Unit trust data is publically available in South Africa. For this research, data was obtained from MorningStar SA and the FundData website. To determine whether the gender of a unit trust’s manager could be a factor in its performance, each female managed unit trust in South Africa was matched with a male managed unit trust. The pairing of funds followed strict criteria, which considered the sector of the fund, the calculated fund beta, the tenor of the funds manager and the size of the fund.
The results indicate that less than 10% of all fund managers in South Africa are female. When comparing the performance of male managed funds to female managed funds, there are no significant results to indicate that one group consistently outperforms the other. In addition, contrary to the popular belief that females are more risk averse, this research indicates that in South Africa, when using beta as the measure of risk, the distribution of the riskiness of a fund is similar for both male managed and female managed funds.
The results also indicate that funds in South Africa produce returns in excess of the FTSE/JSE all share index in the short-term; however, this is not the case in the medium to long term.
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Keywords
Mutual funds, Investments, Women executives -- South Africa.