There’s one thing here that puzzles me, though. In better times, Ms Horlick said of Madoff:
Which raises the question. How come she got a reputation as superwoman?
Here’s a theory. I’m not saying it explains her success at all. I’m just saying that it’s a way for a woman to become a successful fund manager.
It starts from the fact that the stock market is highly seasonal. In the last 20 years, the All-share has returned an average of 8.5% between November 1 and April 30, but only 0.7% between May 1 and October 31. During this time, losses during the six summer months have been twice as frequent - six of 20 times - as losses over the winter.
So, let’s say a fund manager was overweight in high beta or cyclical stocks - those that do especially well in winter and especially badly in summer. She would then out-perform her peers in winter and under-perform in summer.
But what if she took maternity leave in summer, leaving her fund to be managed by a deputy? It would then look as if the fund out-performed only when she was in charge, and under-performed when she was away, even if she had no skill at all but was merely irrationally permanently optimistic about cyclicals and high beta stocks.
Conversely, if she took maternity leave in winter, she could overweight defensive stocks, which do relatively well in summer and badly in winter.
Voila, superwoman is born.
As I say, I'm not saying Ms Horlick did this. But if I were a woman fund manager, it's what I'd do.