"I've made £8,000 since my 20s": Why are women better at investing than men?
New analysis shows that women who invest in financial management have slightly higher long-term returns than men.
But another report shows that only about a quarter of women in the UK have investments, compared with about 40% of men.
We examined the data behind these trends and found some surprising differences in how men and women invest.
Teleri Evans started saving through a Help To Buy ISA when she was 25, and a few years later she opened a Lifetime ISA for stocks and shares. By the age of 33, she had saved £40,000, of which £8,000 (US$18,000; RMB 73,000; NT$346,000) came from investment returns.
She said: "I save very aggressively and live half the time at my mum's house so I try to get as close to the maximum Lifetime ISA contribution of £4,000 each year."
The civil servant, from Cardiff, used the money to pay for a house deposit with his partner earlier this year.
According to a study by consumer finance website Boring Money, only 26% of British women have investments, and the proportion of women under 45 years old has dropped to 23%.
In comparison, 41% of men have investments, and the proportion of men under 45 years old remained at 40%.
So why do fewer women invest than men?
Much of this can be attributed to cultural factors, says Gillian Fleming, co-founder and managing director of Mint Ventures, a British female-led angel investment firm.
"Historically, men have been more likely to be responsible for household investment decisions, and women have historically been less likely to hold the majority of wealth, but that is changing," she said.
"Also, money and wealth creation are not topics women often discuss, and we want to change that."
Women who know how to invest
Talari said she's noticed that has changed recently. “Investing is definitely a topic that women are talking about more and more, which is always a good thing. That’s how it is in my circle of friends,” she said.
When women invest in stocks and shares, analysis by Fidelity International found that its female individual investing clients recorded a cumulative return of 50% over a three-year period, compared with 47% for men. The analysis did not pinpoint a reason for the discrepancy, but why is this the case?
One possible clue to women's slightly higher long-term returns lies in how often they buy and sell investments. Women trade about half as many times as men, according to Barclays.
Joanna Floyd, a business psychologist at The Work Psychologists in London, says this may be because women are more patient and risk-averse.
"Research shows that male investors trade more frequently than women in the hope of pursuing higher returns, but women actually receive higher returns," she said.
“The restraint that kept women from entering the market in the first place is precisely why they are rewarded when they do.”
This more cautious attitude towards risk is not only seen in the investment world. When faced with financial bets, women are more likely to choose the surer option.
When it comes to how women invest, Fleming said they are intentionally more cautious in their decisions.
She said: "Women are often accused of being more risk-averse, but we call it more risk-aware. From my experience talking to male investors, their biggest concern is usually the rate of return."
Fleming also said that women appear to invest more widely. "Men are more likely to invest in technology companies in pursuit of higher potential returns, while women want to invest in a wider range of sectors, from retail, food and drink, health and beauty, femtech to creative industries," she said.
Anna Macdonald, director of investment strategy at financial services firm Hargreaves Lansdown (HL), agrees that women carefully select the companies they invest in.
"Women seem to place more emphasis on the reassurance of where their money is going, what the impact is likely to be, and whether the investment is truly right for them," she said.
"Our research shows that men are more attracted to potential financial rewards."
