There’s a school of thought that female investors who trade shares can be far more successful than males by tapping into some rather instinctual traits.
Research by UNSW Business School suggests that women tend to be more cautious and spend more time analysing a company before making a trade and that they might even possess a calmer approach during financial storms.
A study by Fidelity Investments found that women tend to outperform the opposite gender by 0.4%.
So if we look closer at this body of research, we can see what makes women better share market traders and importantly identify how can you use these traits to improve your own investing.
- Women are better students
Trading requires countless hours of dedicated research and hours of study. Women are generally more attentive, and the same holistic approach to learning that helped women through schooling serve them in their trading careers as well. A very persistent nature and wanting to learn more to make them better traders is on their side.
- Women are great multi-taskers
Multitasking is an essential skill set that women tend to possess. Trading requires constant juggling between multiple positions and monitoring financials, all while when you are still learning. Women can switch in and out of trading mode quickly when the situation demands.
- Women are more risk averse
Women are disciplined, less prone to panic, and calmer in a time of crisis, making them more risk-free. They find it easier to reject a potential trade if they think it won’t do any good for the long run.
On the other hand, they never stick to a strategy, which is a crucial aspect of trading. They make different trading strategies for various trading opportunities and only follow a similar approach when they think there is an opportunity. So, they never hold a bad trade longer, which prevents them from taking more significant losses.
- Women don’t have swinging egos
Women like to be competitive, and yes, they do have egos, but they don’t want to peg their self-worth to their bank accounts.
Female traders have more significant motivations, and they don’t waste any opportunity of learning something new, even if it is from their counterparts. You may also find them taking forex trading courses and learning new things. This makes them better at trading stocks and bonds.
- Women talk about their feelings
Women are generally less likely then men to hide their emotions; they reach out to whomever they can and let them know what a bad day they have just had.
This can make them better traders because they are never shy about having a conversation about their trading life. They share things not only to get themselves relieved but also in the hope of getting valuable advice. This is one trait that makes them better at financials.
This Financy article has been produced in partnership with Monex Securities Australia.