Women as Investors, Then and Now

1957. Earl S. MacNeill in "Making the Most of Your Estate: A Guide for the Salaried Man:"

[Trust officers] know tens of thousands of women who handle investments as cannily as any man. Yet they have seen the reverse side of the coin too often …:

Women are inclined … to be greater gamblers than men.

Or, at the opposite extreme … they "run scared" ….

In the choice of investments, as well as of investment advisers, they are motivated subjectively … they are ruled to a greater extent by prejudice.

… their vaunted feminine intuition leads to making the more mistakes and clinging the more stubbornly to them.

2010. Jeff Sommer in his NY Times article, "How Men's Overconfidence Hurts Them as Investors:"

Men and women invest differently, a growing body of research has found. And in at least one important respect, women may be better at it.

Among 2.7 million people with IRAs at Vanguard … during the financial crisis of 2008 and 2009, men were much more likely than women to sell their shares at stock market lows.

[M]en think they know what they’re doing, even when they really don’t know what they’re doing …. Women, on the other hand, appear more likely to acknowledge when they don’t know something — like the direction of the stock market or of the price of a stock or a bond.

[One study found] men traded stocks nearly 50 percent more often than women. This added trading drove up the men’s costs and lowered their returns.

…while both sexes reduced net returns through trading, men did so by 0.94 percentage points more per year.

Take both the old and new views of women as investors with a grain of salt. Professor Brad M. Barber is right: When it comes to managing securities, “The differences among women and the differences among men are much greater than the differences between men and women.”

Yet women investors, some women investors, do seem to welcome special attention. Should wealth management firms offer programs specifically for women? Why? Why not?