Men vs. Women: Who are better investors?

July 31, 2015

 

  

A recent Wall Street Journal article examined the research academics and financial institutions have done on the respective investing habits of men and women.

 

The conclusion?  Men are more confident about investing and women are more goal-oriented and trade less.  Of course, generalities are dangerous, but the studies do show where each sex's strengths lie.

 

Women are more likely to choose target-date funds in their employer sponsored retirement accounts and men tend to invest in other fund options, including stock funds.  But, according to data from the Vanguard Group, overall stock exposure between men and women is a virtual tie.

 

Men trade more according to Vanguard, and that can be a disadvantage.  Trading less means women are less likely to trade at the wrong time, says Jean Young, senior research analyst at Vanguard.

 

Women are more likely than men to participate in employer sponsored retirement plans  by 73 to 66 %, and contribute slightly more as well. 

 

Men are much more confident in their investing skills than women.  55% of women agreed that they know less than the average investor about financial markets and investing in general, whereas only 27% of men admitted so.

 

Fidelity analyzed data from 13 million retirement investors and found that 6% more women used professional managers than men.

 

Another study showed that women are less apt to view investing as a competition than men.  Men studied were more likely to take financial risks when seeing images of men in advertising that they consider to be more virile-looking than themselves.  Men are channeling their cave man instincts according to the study.

 

Men and women are probably best learning each other's habits and adapting their own behavior from what they learn.  

 

 

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