Several studies have shown that overconfidence and vulnerability to panic make men tend to be worse investors than women
According to a 2015 report by Morningstar, Inc., only 2.5% of assets belonging to the universe of U.S. open mutual funds are managed by a woman. The mutual fund is one of the three types of funds available in the stock market, which correspond to more than US $ 13 trillion. The contrast with the number of funds administered by men, that is, 77.9%, is abysmal.
Leer en español. ¿Las mujeres son mejores inversionistas que los hombres?
However, this gender gap is not exclusively of the United States. Globally, only 20% of funds have at least one woman manager, according to a 2016 report by Morningstar, Inc. This data cannot be isolated from cases like that of Sara Tirschwell, a former TCW Group Inc. fund manager, who in January 2018 sued TCW alleging that she was dismissed without cause in December 2017 after claiming that her boss sexually harassed her, a claim that was denied by TCW.
These figures should surprise not only because of the huge gap between men and women but because of the well-documented fact that women are better investors than men.
In 2001, authors of a study from the University of California at Davis concluded that men, compared to women, tend to market more and perform worse due to overconfidence. More recent studies support this conclusion. In 2010, Vanguard reported that during the 2008 financial crisis men were much more vulnerable to panic than women. As a result, many of them sold stocks at low costs, which meant great losses given the recovery of the stock market in 2009.
You can also read: Is it of any use for women to have more bank accounts than men?
Another study from the same year by The Boston Consulting Group suggested that women are not distracted by the short-term performance of their investments, which it does happen to men. For its part, Bloomberg, seeking to support the reports just mentioned, cites a study from 2017 which states that men's testosterone levels increase the tendency to rely on intuition and reduce cognitive reflection in decision making.
The figures make it clear that, despite the rejection they receive in this labor sector, women tend to be better at investing than men. So much so that, in a recent article, Bloomberg compares the investment behavior of Warren Buffett, one of the best investors in history, with the way women perform in the asset market. Luckily, little by little this is changing.
The Wall Street Journal recently reported that Fidelity Investments, a company led by Abigail Johnson who is the founder's granddaughter, is considering changing its approach to the investment market, which emphasizes star managers looking to focus on investor teams as a response to claims of sexual harassment within the company. The truth is that this is just a first step on a long road worth traveling because as Bloomberg concludes, women have all the capacities to be big investors; but only if they are allowed to participate with equality.
LatinAmerican Post | Juan Diego Bogotá
Translated from "¿Las mujeres son mejores inversionistas que los hombres?"