$9 billion hedge fund manager David Abrams says he ‘came up short’ when trying to fix one of the biggest problems facing the industry

$9 billion hedge fund manager David Abrams says he ‘came up short’ when trying to fix one of the biggest problems facing the industry


Investment teams at big hedge funds are overwhelmingly male, a well-known problem the industry has acknowledged for years. The problem managers are now running into is that they do not know how to fix it — especially as, in their eyes, the industry is more than ready to accept women. “Out-and-out prejudice” against women and minorities that used to be common is nearly nonexistent in finance and investment management, said David Abrams, managing partner of $8.7 billion Abrams Capital. Abrams was speaking in a rare public appearance at the Project Punch Card Value Investing Conference last week in New York aimed at boosting the number of women and minorities in the industry. “I’m not totally sure what exactly is going on,” Abrams said, in a comment reminiscent of those Pershing Square’s Bill Ackman made in 2016 about not being able to find any female investors to hire. Abrams said he has seen a more equal gender split at business schools, and the two-year programs investment banks run that pull their ranks from fresh college graduates. “Somehow the women are falling off after that,” Abrams said. His firm is 43% female, Abrams said, and includes women in senior leadership positions, such as general counsel, but noted his investment team is more heavily skewed to men, though he declined to give the exact gender breakdown on the unit. Abrams said he had an opening five years ago on his investment team, and received roughly 50 to 60 resumes after hiring a search firm. But none of the resumes belonged to a woman. Investing teams in the hedge fund space are notoriously low on women portfolio managers. A Wall Street Journal analysis of the industry from August found that just two of the 50 biggest funds were managed by women. A Money Management Institute report from 2017 found that women and minorities only run 1.1% of the entire asset management industry’s money. Abrams acknowledged that he still hears “complete horses—” opinions from some in the industry, like “women aren’t good risk takers,” but believes most of that prejudice “has disappeared.” The challenge many firms may be running into is that senior leaders at firms are often overwhelming white and male. This may make it hard for young, diverse candidates to see their career path, according to some top investors. Ariel Investments’ CEO John Rogers, one of the most prominent black investors in the US, said his firm has been able to attract “dynamic young talent” precisely because the upper levels of his organization is diverse. “They see people that look them in our organization,” he said at the conference. For his part, Abrams said he is driven to change the status quo and that he is open to “people telling me to do x, y and z to fix it.” He said he was recently at a wedding and spoke with a female portfolio manager about the gender disparity in investment teams. “She said ‘well when you had 50 or 60 resumes, and you didn’t get any women, did you ask specifically for women’s resumes?’ and I said ‘I didn’t, but next time I will.’ I thought I had done what I was supposed to be doing, and somehow I came up short,” he said. “I don’t have a silver bullet for this issue.”
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