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Heuristics in the wild: exploring fund manager decisions through the COVID pandemic

Daniel Gilcher (Department of Finance and Accounting, EBS European Business School gGmbH, Wiesbaden, Germany)

Qualitative Research in Financial Markets

ISSN: 1755-4179

Article publication date: 30 November 2022




This paper aims to provide a novel explorative perspective on fund managers’ decisions under uncertainty. The current COVID pandemic is used as a unique reference frame to study how heuristics are used in institutional financial practice.


This study follows a grounded theory approach. A total of 282 diverse publications between October 2019 and October 2020 for 20 German mutual funds are qualitatively analyzed. A theory of adaptive heuristics for fund managers is developed.


Fund managers adapt their heuristics during a crisis and this adaptive process flows through three stages. Increasing complexity in the environment leads to the adaption of simplest heuristics around investment decisions. Three distinct stages of adaption: precrisis, uncertainty and stabilization emerge from the data.

Research limitations/implications

This study’s data is based on publicly available information. There might be a discrepancy between publicly stated and internal reasoning.

Practical implications

Money managers can use the provided framework to assess their decision-making in crises. The developed adaptive processes of heuristics can assist capital allocators who choose and rate fund managers. Policymakers and regulators can learn about the aspects of investor decisions that their actions and communication address. Teaching can use this study to exemplify the nature of financial markets as adaptive systems rather than static structures.


To the best of the author’s/authors’ knowledge, this study is the first to systematically explore the heuristics of professional money managers because they navigate a large-scale exogenous crisis.



The author wishes to thank two anonymous reviewers for their insightful comments. Ulrich Hommel and Julia Hartmann provided valuable feedback during the research process.


Gilcher, D. (2022), "Heuristics in the wild: exploring fund manager decisions through the COVID pandemic", Qualitative Research in Financial Markets, Vol. ahead-of-print No. ahead-of-print.



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