There was once a time when a woman would be advised to find a husband as means of financial preparedness for the future. Those days are long gone though. Over the past several decades more and more women are entering the workforce and are taking care of themselves financially. While the pay may not be equal quite yet, it is getting close. It seems as though a new trend in investing has emerged; women are becoming better at making investments than men are.
We all know that men would prefer to not stop and ask directions, whereas women enjoy doing just about everything with other women. This stereotype holds true in many different areas in one’s life, including investing. Researchers have discovered that men prefer to learn about investing on their own, while women prefer groups. This information can be found in detail in the “Handbook of Consumer Finance Research.” This may be giving women the leg up in investing.
What this research is telling is us is that men like to direct their learning themselves. They prefer to go online and do their research as opposed to women, who prefer to go to seminars and meet with professionals. It seems that it is this difference that is keeping men and women from being equal in the investment world. The biggest difference is simply how men and women learn.
Confidence can play a part in this as well. Research has shown that as far as men go, they tend to be overly confident when making their investments. Women on the other hand, have a tendency to be under confident. This means that men are more willing to take risks which can pay off, or not. Women do not take as many risks so they have a more steady return on their investments. Men want a big payoff while women do not want to risk everything that they have.
Most experts agree that in order to be a better investor both men and women need to make sure that they know what their own issues are. No matter if you are a man or a women you should be able to identify if you are an overly confident or under confident investor. Do emotions play a role in your investment decisions? You need to take a look at yourself and decide if it all is logical. Are you afraid to make a particular investment? If you are then you need to ask yourself why and whether or not it is logical to feel this fear. Knowing your limitations, your insecurities, and all that other stuff, you can make better decisions when you are investing your money.
There is still a little debate about whether or not women are better at investing than men. One thing that is clear is that men and women have different ways to learn about investing, therefore they have different ways they go about making their investments. What will the trend be in the next few years? It is hard to say, but this one may continue for some time to come.
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