Women may be a rarity in fund management functions in India but their performance speaks for itself. Morningstar study found that out of the total assets managed by women fund managers, 61% of assets outperformed the benchmark/peer group average over one-year basis, 81% over three-year basis and 86% over five-year basis. Morningstar’s Ravi Samalad chats with Sohini Andani, Fund Manager, SBI Mutual Fund, on how women are making a mark in fund management.
What attracted you to fund management? Did you always wanted to manage money?
I was attracted to equity research and investing field as I would get to understand how different businesses are being run, what are the factors which lead to success or failure of various businesses. Investing gives an opportunity to be a co-owner in many businesses and generating wealth for investors.
Do you think women make better investment decisions? If yes, why?
Well, one cannot generalize based on gender. It depends upon the aptitude and passion of the person who is taking investment decisions. I have been more focused on protecting capital before growing, so one can say that I am more risk conscious being a woman. To that extent, it is a bit different style. However, both have an equal scope of investing successfully.
Do you think diversity in team brings about better results, in terms of investment decisions and performance?
Yes, a good team (people with diverse background) would evaluate investment decisions from different perspectives, which can help in reducing chances of making mistakes. A diverse team can build specialisation in various sectors and can provide inputs for the overall better decision making. Also, intense discussions within team on various sectors and stock ideas helps in constructing a balanced portfolio focused both risk mitigation and return maximisation.
As compared to a few years back, do you feel women’s representation is increasing in investment management functions in the financial services industry?
Yes, it has increased vis-à-vis, say where it was a decade back may be, however, still a long way to go, when it comes to senior decision-making roles.
How can the industry attract more women in fund management roles?
By providing equal opportunity to take decisions. A job of a fund manager involves taking decisions on a continuous basis. A man and a woman bring different perspective to decision making. For any organisation, it is pertinent to respect the ability of women to take decision and provide environment which encourages women to take decisions in order to attract and retain women in fund management roles. Also, creating a reward structure which does not differentiate between genders and based purely on rewarding excellence is important to attract more women to this profession.
What were your notable investment mistakes and what did you learn from them?
For me, risk averseness causes opportunity lost many times. I need to be much more open here while not losing my focus on containing risk. For e.g. Investing in commodities involves identifying or recognising a positive turn in cycle. I have always lagged in understanding these factors and have thus lost opportunities to make handsome returns. Investing in these companies before the cycle turns when the stocks are available below their fair value, especially in case of companies where balance sheet risk is contained is what I have learnt over a period of time.
What would be your advice to women who aspire to become fund managers?
One should be a good analyst, before becoming a fund manager. Choose this profession if it excites you to study/know about different businesses and be a co-owner. The profession requires taking decisions continuously and going right more number of times than going wrong. So, if one likes to take decisions and is ready to own it and be responsible for it, you would enjoy being fund manager. The role comes with a significant responsibility to be a guardian of hard earned money of the investors.
If not a fund manager, you would have been…
I would like to teach if/when I am not a fund manager. It would very satisfying if I can add value in any way to younger people.
Download Morningstar Women Fund Manager Report 2018 here.
