How do women invest?

World statistics say that women live longer than men while their salaries are lower. Besides, the major part of the fair sex interrupt their career for the sake of having and raising children, which often negatively affects their level of financial well-being too. Due to this reason, investing is an alternative way for women to ensure their future and financial security at the end of their career path.

Unfortunately, 71% of women around the world still keep savings in cash, and only 9% are sure they can beat men in the stock market.

The data provided by Warwick Business School shows that the return on women's investments exceeds the annual return on the FTSE 100 index by 1.94 % (this index is based on the share prices of the TOP 100 companies with maximum capitalization listed on the London Stock Exchange), whereas for men this indicator is only 0.14% higher. In other words, the average return on women's investments is higher than the average return on 100 companies with the highest capitalization on the British Stock Exchange!

Research by Fidelity Investments suggests that women's portfolios generate 0.4% more profit than men's. These facts debunk the stereotype that investment is an occupation predominantly for men. What is the peculiarity of women's investment strategy?

1. Women invest for profit. Men often prefer to take risks for the sake of an ego boost, so they choose unstable, but potentially highly profitable projects in order to earn money in the short run.

2. Women are not risk-takers. Women often choose balanced long-term investment strategies. Pursuing the goal of earning money on dividends to pay for a child's education, women will choose shares in a reliable company and hold them for several years not paying attention to short-term market volatility and value fluctuations. This probably explains why 91 % of venture capital investors are men.

3. Men get engaged in trading 45% more often than women - this data is cited by the analysts of the University of California in Berkeley in the article "Boys Will Be Boys". Apparently, men react more actively to changes in the market, so they tend to close deals more often.

4. Men are more self–confident than women. Two-thirds of men (68 %) and half of women (52%) have a positive view of their ability to invest. This data is obtained in the course of the study "U.S. Trust insights on wealth and worth". In combination with the behavioral factors described above, self-confidence men demonstrate can transform into arrogance leading to impulsive trading and a decrease in the final returns on the investment portfolio.

Today, the share of women investors in the project "Duyunov's motors" is about 10 %. We hope that this percentage will increase over time: the project is approaching a successful end, which means that the investment risks are reducing with every day.

Despite low investment activity, women own 40% of the global wealth (Credit Suisse 2018 Report), and this factor may soon change the balance of power in the investment market.