Hedge Funds Will Leap At Any Advantage, Unless It Means Hiring More Women Or Black People

Former Canyon Partners portfolio manager and partner Dominique Mielle has written a book, a memoir of her career in the hedge fund industry, but also a cri de coeur, explaining why she was both Canyon’s only female PM and only female partner, as asking why that would probably still be the case today. And almost as if it were commissioned by Simon & Schuster itself, there’s yet another study out that shows what almost all of the other studies on the matter have shown, that those handful of women (and minorities) who are running hedge funds do better than their male counterparts. And it does so in a way hedge funds are supposed to understand: analytically, with cold, hard numbers.

Funds with minorities represented in management had a median one-year total return of 29.6% and those with women represented in management returned 21.6%. Fund managers without those attributes had a 12.7% gain in that period.

Over a three-year annualized period, women and minority managers posted a total return of 10.6% and 7.8%, respectively. Non-diverse managers had a 6.4% return.

Surely, then, gifted this mounting data that the fewer white penises making investment decisions, the better, hedge funds would be racing to diversify their ranks, especially their money-management ranks. There’s an edge to be had, an underused arbitrage opportunity, a way to distinguish one from the increasingly par pack. I think it’s safe to say at this point, you know where this is going.

Solomon Page based its analysis on 4,300 personnel moves of full-time hedge fund professionals globally between July 1st 2020 and June 30th 2021. It found that 71% of all hedge fund employee moves during this period were male in the U.S., that 74% were male in Europe and that 69% were male in Asia…. Over 90% of U.S. and 95% of European hedge fund admin employees finding new jobs were female, compared to around 10% to 12% of portfolio managers….

In almost all cases, Solomon Page found that non-Asian, non-male candidates moved into less prestigious jobs in hedge funds. For example, female candidates were better represented in lower paying data analyst jobs than higher paying quant jobs. In the U.S., Hispanic and black candidates were disproportionately found in trade support rather than trading roles.

How to get a job in a hedge fund: be white, be Asian, be male [efinancialcareers]
Hedge Funds Run by Women, Minorities Outperform Market Peers [Bloomberg Quint]
I Was the Only Female Partner at My Hedge Fund. Here’s What Needs to Change. [II]