More women are trading now than ever before.
The number of women traders has skyrocketed over the past 20 years. But why are women taking greater interest now than they were before? One of the obvious reasons is that investors—more than ever—have been heavily focused on companies and funds that are interested in improving the lives of women and girls globally. This, in turn, has led to more women being attracted to investing in other women-centric products and companies, as well as harnessing the power of investing and trading as a way to improve their own lives.
According to a 2015 study by online broker City Index in the UK, 46% more women opened trading accounts with the firm during the first quarter of 2015 compared to 2014—just one year prior—while the number of female traders opening accounts annually had risen by a massive 1,434% overall since 2001.
Prestigious banks and progressive non-profits have been taking note, too.
Goldman Sachs is strategically working to motivate college women onto the trading floor with their Women’s Trader Academy program. So far, so good. In 2019, the number of Goldman’s female traders increased by more than 140% from a year prior. There’s also been a major push from Girls Who Invest, a non-profit founded by Seema Hingorani, dedicated to getting more young women involved in the finance industry. The ambitious aim of Girls Who Invest is to get 30% of the world’s investable capital managed by women by 2030.
That’s only ten years away. Will enough women get there?
What makes trading enticing for women?
There are a myriad reasons that women are attracted to trading.
Some love the thrill.
“It’s not boring,” says Sarah Behbehani, a trader with 20 years under her belt,”And I really like the reward of immediately knowing your decision was right or wrong. I also love the adrenaline rush and the fact that every single day is a new challenge.”
Others look at it as a game.
Says Linda Bradford Raschke, “For me, this is a creative thinking process: I’m playing puzzles and games in my head. The hardest part for traders is accepting that we don’t have control. We have to stay in the moment just like a professional dancer or singer. Don’t think!”
The future is bright—even now.
According to Mire B. Acosta, “Financial markets are very volatile due to everything related to the pandemic, but this is a great opportunity for women to start trading from home in world markets.”
What makes women uniquely successful in trading?
Women are hardwired for prosperous trading in their own unique ways while others approach trading differently in key ways than men do.
Strong emotional intelligence is decidedly a factor according to Lucy Baldwin, Global Head of Credit Suisse UK. “Emotional intelligence and a strong IQ. These two elements enhance a trader’s discipline – a vital quality for trading success.”
Millennial women also bring specific strengths to the table. A generation notoriously saddled with massive student loan debt, and an awareness that retirement isn’t a given, millennials are equipped with a definitive future-forward sensibility and “…analysts have noted that, despite the unique financial obstacles facing their age group, ‘millennials’ — those born between the 1980s through to the mid-1990s — are more likely to hold a portfolio of investments than any previous generation!”
Millennial women are also more inclined to talk openly about money management with friends today than previous generations. There are also more organizations specifically geared to those interactions that offer them strength in numbers.
And what about the actual results women achieve in trading? They speak for themselves actually.
A three-year Warwick Business School statistical survey revealed that “women are investing more to support their financial goals, whereas men are attracted to what they see as the thrill of investing.”
- Women outperform men at investing by 1.8%
- Men more likely to pick more speculative stocks
- Female investors have a more long-term perspective
Fidelity conducted another study where over 8 million investment accounts were reviewed. Conclusion: women earned higher returns and were better savers.
How trading can improve/change your life.
Self-reliance applies to all aspects of our lives and financial aptitude is no exception. The fact is that women can learn to trade and thrive in the field as readily as any man can—and any woman who’s so inclined should do so.
In her whitepaper, How smart women are shaping the future of the financial industry, Barbara Stewart states: “Financial knowledge allows women to move towards meaningful work in any field that they choose. It gives them the high level view, but also allows them to drill down for deeper insights.”
It also gives them the confidence they need to thrive in a male-dominated industry—and often, due to their strategic risk averse behavior— to outperform the men.