Can we observe style extremity in managerial characteristics? Evidence from polish investment funds

Purpose The study aims to determine whether managers’ characteristics translate into their investment styles. Design/methodology/approach This study describes the characteristics of 287 fund managers and identifies the relevant parameters that define investment styles, which are determined based on investment fund performance. The research sample consisted of 118 domestic equity funds operating in Poland in the period 2000–2017. The research methods used were random effects models and fixed effects models. Findings The manager’s gender and education are key drivers of the extremity of investment style. We may attribute the conventionality of style to the “element of femininity” evident in investment strategies, particularly in team-managed funds. Moreover, a manager's social and business network – especially when they have studied in major metropolitan areas – may facilitate the informal dissemination of information among market participants with a similar educational background, thereby benefiting their investment approach. Practical implications The article verifies that, even among funds belonging to the same group defined by a common investment policy, significant differences in portfolio composition become evident through the assessment of investment style extremity. This study provides findings in the context of variables, describing a manager who has a significant impact on this phenomenon. Originality/value Scholars do not often analyze the relationship between managerial traits and the investment styles exhibited by funds, and there is a lack of such research in the Polish and European literature. This means the study is original and partially fills an existing research gap.