Men are from Mars and women are from Venus. This much abused cliché could not be further from the truth where investing is concerned. Apparently, men and women use different approaches when handling their investments, with, for the lack of a better term, the weaker sex, doing a better job.
What characteristics make women exceptional investors than men?
They love to play the waiting game
Patience is not a virtue that most men have, but the opposite sex can stretch it even further. This is why they are likely to stay the course in the long term and trade less frequently. Whether a risk aversion strategy or not, men tend to do just the opposite. Although this leads to higher commissions and fees, trading frequently can erode returns and undermine investment strategies.
They like to play it safe
Most women are not risk taker, a trait that is carried out in their choice of investments. They would rather pursue a low risk investment that moves in a steady course and promises more stable returns. Women are also more likely to use proven financial strategies, than make investment decisions that could potentially lead to mistakes. They would prefer not to trade too often or buy high and sell low.
They have better self-control
Where financial discipline is concerned, women scored high based on a study. This then leads to higher gains, greater wealth and increased financial satisfaction. And they accuse women of being a shopaholic. Perhaps, investing is an entirely different ballgame, and women tend to use a different approach than they would with shopping. With greater self-control, the female population also don’t react in haste when the market swings. They stay calm even when a crash is looming, at least most of them do.
Like they said slow and steady wins the race. Men may not fully appreciate a woman’s patience, but they are likely to be impressed where returns and gains are concerned.