I am asked on Twitter (follow me on @MerrynSW) by the editors of what looks like it will be a great new magazine (Libertine) what I think about this Wall Street Journal article on female investors.
The basic premise is that female investors aren’t the same as male investors. Investing isn’t a hobby for them, it is a way to achieve a goal. Therefore if the industry wants to capture them as effectively as it does men, it needs to advertise a “long term goal orientated approach”.
Do I agree? I do.
Studies show that women hold more of their wealth in cash than men do; that when they do invest they do so for the long term; that they don’t trade often, and practically never spread bet; that they seek out simple investments; and (this is the good news) that as a result, their long term returns are a little higher than those of men.
But I think that the absolutely key point here is the ‘hobby’ bit. By the time they have money to invest, most women are in their 30s or 40s. They have jobs, children, houses, fragile parents and partners. They have no time for anything. Ever.
Men very often appear to somehow find the time to spend their evenings at computers thinking about what to buy and sell (racking up the costs as they go). Women, not so much. So if they get around to investing, they need something they can buy and leave.
The WSJ piece looks at what kind of portfolios they should be sold in the US. Here, I reckon there is room for a few big funds to offer themselves up as a one stop shop to busy women.
Something for the board of Alliance Trust (a rarity in that it is a FTSE 250 firm run by a woman) to think about perhaps?