Institutional Investor's Alpha Magazine - September 2008 - (Page 54)

Andrea Feingold (left) has led Feingold O’Keeffe Capital from $10 million in assets to $1.3 billion. Nancy Havens left Bear Stearns to form New York–based Havens Advisors in 1995 and has delivered steady annualized returns of 10 percent. Alpha’s annual list of the 100 largest hedge funds. With about $3 billion in assets, Traci Lerner’s Chesapeake Partners in Baltimore, a value-oriented distressed fund, is the largest woman-owned fund. Being small can make it tough to win mandates from institutional investors. Antonio Muñoz, CEO of EIM Management USA, the U.S. arm of the $15 billion Swiss fund-of-funds ﬁrm EIM, estimates that no more than 20 to 30 woman-run hedge funds are big enough for institutions to consider. Eight of them, he says, are in his ﬁrm’s portfolios, including Haugerud’s Galtere. Anne Casscells, CIO and co-president of $6.5 billion Aetos Capital in Menlo Park, California, has just three women managers on her roster of 45, but that’s three more than most funds of hedge funds have. “I guess I know a lot more women hedge fund managers than a lot of people do,” Casscells says. I n 2006 researchers at the Olin Business School at Washington University in St. Louis designed an experiment meant to determine the relative appeal of investing in a company run by a man compared with one run by a woman. They created almost identical pitch books for two companies positioned as potential private equity investments. Firm personnel, top-management résumés and company ﬁ nancial details were all exactly the same. Only one factor distinguished the companies from one another: In one case the CEO was a man; in the other it was a woman. The photos of the two CEOs — who had identical education and work histories — were carefully chosen to present a similar level of attractiveness. Then the two pitch books were randomly distributed among a group of more than 200 sophisticated private equity investors, 20 percent female and 80 percent male. The results were startling: Three times the number of investors, both male and female, selected the male-owned ﬁ rm. “I thought there would be a difference of maybe 30 percent more for the male ﬁ rm,” says Judi McLean Parks, an Olin professor of organizational behavior and co-author of the study. “But 300 percent!” Magnifying the stark results, the majority of the investors participating in the study said that the womanowned ﬁrm was a riskier investment and that the female principal would be less able to handle a crisis. Parks says their results shatter the commonly held assumptions that “professionals are making their decisions by the numbers” and that “if you are a sophisticated investor, the sex of the CEO should be irrelevant.” This would not be news to Haugerud, who is unhappy with the glacial pace of women’s entry into hedge funds. She believes that the lack of leadership diversity in the ﬁ nancial industry — and the sameness of vision that it engenders — has been a major cause of the recent market turmoil. To help address the problem, Haugerud is considering starting a school for women traders. “There are men who want to take advantage of women’s trading skills, but they don’t know how to tap into them,” she says. 54 • INSTITUTIONAL INVESTOR’S ALPHA • SEPTEMBER 2008

Table of Contents Feed for the Digital Edition of Institutional Investor's Alpha Magazine - September 2008

Institutional Investor's Alpha Magazine - September 2008 Contents Letter from the Editor Longs & Shorts Pension Corner: Culling the Herd The Good Guys: Ending the Cycle Interview: Press Credentials Cover Story: Rethinking Chris Hohn Strategies: At the Edge of the Earth Profile: Alpha Femals Strategies: Tails, You Lose Research Center: The Top Equity Trading Firms Alpha Bytes: The Light Is On Unhedged: Commentary: Not-So-Dire Diagnosis

Institutional Investor's Alpha Magazine - September 2008

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