For over 20 years, I’ve been baffled.
Sure, we women have become excellent dollar watchers and bargain hunters. But investors? Forget about it. We want to learn, but lack the confidence to act.
And here’s what’s really baffling. Once women enter in the market, we’re actually better investors than men. Key findings in a recent article on The Motley Fool, (https://www.fool.com/research/women-in-investing-research/) show that “female investors earn better returns than men—up to 1% in some studies and, on average, women lost 2.5% of their stock portfolio value in 2015, while men lost 3.8%.”
But, women are still less confident than men in their investing ability. Only 9% of women think they make better investors than men according a Fidelity report.
What’s up with this??? The answer, I’ve discovered, lies in our brain.
Women and men’s brains are different and process information differently.
Men see investment risk as a challenge.
Women see investment risk as a threat.
Men measure success by beating an index or their peers. Women measure success by meeting their goals and helping others.
Men, in their competitiveness, trade stocks frequently. Women, with our lack confidence, tend to buy and hold. A much better strategy over time.
Here’s the irony. Our lack of confidence actually works in our favor. The more I study neuroscience, the more I’m convinced. Rather than avoiding investing because it feels like a threat, let’s focus on rewiring our brains to become confident investors.
What’s your confidence level in your investing skill? What can you do to improve it? Leave me a comment below.