Study: unattractive managers outperform funds with attractive managers by over 2% per annum

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Abstract

In this paper, we study the relationship between stock fund managers’ facial attractiveness and fund outcomes. Utilizing the state-of-art deep learning technique to quantify facial attractiveness, we find that funds with facial unattractive managers outperform funds with attractive managers by over 2% per annum. We next show that good-looking managers attract significant higher fund flow especially if the funds are available on Fintech platforms where their photos are accessible to investors. Good-looking managers also have greater chance of promotion and tend to move to small firms. The potential explanations for their underperformance include inadequate ability, insufficient effort, overconfidence and inefficient site visits.

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https://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID4609822_code3986411.pdf?abstractid=4322134&mirid=1