Hold onto your seats boys – research shows female investors outperform men.
In this episode of Talking Trading we speak to Meredith Jones, author of Women of the Street. She provides fresh data, stories and statistics from Wall Street on why women have a money management edge. From less ‘overconfidence’, over-trading and testosterone to a greater tolerance for market noise, Meredith shows that if someone is wearing Louboutins and not loafers in the markets then they may be the better investor.
Meredith Jones spent 17 years on Wall Street and interviewed 11 top performing female money managers for her book ‘Women of The Street’.
Chris Tate is a fan of Meredith and her evidence that women are better investors than men and that we would all be wealthier if we invested ‘like a girl’.
Women’s outperformance of men can be drawn to specific characteristics:
- Less OVER confidence, which means women tend not to over trade.
- Greater conviction in their investments, which means women tend not sell into bad markets and helps them navigate volatile markets.
- Frequent reevaluation of their portfolio, which means women tend to recognize more effectively if they are the only person doing something in the market and they are either early or they are a lunatic.
- Out of the box thinking. Women often look for stocks that may not be as sexy or flashy but have good growth.
- Ability to match to expectation with actual results. There is a theory that says if there were more money managers in the markets then there would not be as much volatility and we would not have as many bubbles and busts.
Meredith also walks us through the evolutionary reasons why men and women developed their different financial skill sets and why she advocates both male and female investment managers to ensure true diversification and maximize your money.