Thursday, January 16, 2014

Women are Better at Managing Money

Um... not sure if this is a good thing, or a bad thing?  Want Better Hedge Fund Returns? Try One Led by a Woman

“There is meaningful alpha to be gained from investing in women-owned and -managed funds,” Meredith Jones, a director at Rothstein Kass who wrote the report, said in an interview. “There appear to be both behavioral and biological factors that impact women’s ability to manage money and make them consistent.”

Women are different in behavior and biology in relation to money?  Because they are less risk adverse.  Is this even difference feminism? 

http://lawprofessors.typepad.com/gender_law/2014/01/women-are-better-at-managing-money.html

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Comments

Women are thought to be more risk averse than men when making investment decisions. The article considers that they may be less impulsive.

At this point I rather doubt you need to consider whether the purportedly increased alpha associated with female-owned and -managed funds is a good thing (although I'm not sure why it would be bad unless as evidence of actual biological differences between the sexes), because nothing in the study's methodology appears terribly robust.

Posted by: Think Like a 1L | Jan 20, 2014 1:12:21 AM

The danger is in assuming the attributes -- here caution -- are gender based rather than individual or learned through training. Here risk aversion is good. But it can be used to discriminate against women too, for example denying them positions in the military or as firefighters if women as a whole can't deal with the risk

Posted by: TT | Jan 20, 2014 4:29:13 PM

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