The rise of female investors

Working from home due to social distancing

Historically, women have been underrepresented within the investing space. But it looks like times are changing, and the number of female investors is rising. Not only is this good for the markets but it also helps push us closer towards wealth equality.

Here’s what’s going on with female investing right now and what we might expect to see going forward.

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What do we know about female investors?

The experts at digital savings and investment app Chip have dug out some interesting insights about their customers:

  • Out of their 350,000 strong customer base, close to a third (27%) are women
  • Women appear to have a larger appetite for risk than has been reported in the past
  • Female investors are outpacing male investors when it comes to ESG investing
  • 46% of their female investors have a stocks and shares ISA

What are the top choices for investors?

The most popular investments for men and women show contrasting attitudes.

For women, the top five funds are:

  1. Balanced (BlackRock Consensus 60 – Acc (D))
  2. Ethical X (MyMap 5 Select ESG Fund)
  3. Cautious X (MyMap 4)
  4. Clean Energy (iShares Global Clean Energy UCITS ETF)
  5. Emerging Markets (BlackRock Emerging Markets Fund) 

The top funds chosen by men looked like this:

  1. Cautious (BlackRock Consensus 35 – Acc (D))
  2. Healthcare Innovation (iShares Healthcare Innovation UCITS ETF)
  3. Balanced X (MyMap 5)
  4. Adventurous X (MyMap 6)
  5. Adventurous (BlackRock Consensus 85 – Acc (D))

The top choices for women do not include some of the more adventurous picks favoured by men. But the inclusion of an emerging markets fund along with ethical and clean energy funds highlights two important points. Firstly, it shows that reducing risk is not a top priority for women. Secondly, where their money is going is a decisive factor for female investors.

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How can platforms increase female participation?

Simon Rabin, CEO of Chip, had this to say about their aims to encourage a more diverse base of investors: “Our goal is to democratise savings and investments. I believe that everyone should have access to tools that can effortlessly take their savings to the next level and help grow their wealth. This includes levelling out the playing field, which has traditionally skewed male.

“We want to show that investing is no longer an elite, exclusive world dominated by dusty legacy wealth managers or macho crypto-trading ‘bros’. Investing is a tool everyone should consider using.

“I hope that by removing barriers in the form of mountains of paperwork, overly complicated interfaces and complex language, we can empower absolutely everyone to put their money to work.”

What lays ahead for female investors?

It seems as though the number of women choosing to invest is trending in a positive direction. If this activity continues, it will be interesting to see the broader impact and whether the demand for SRI investing becomes more mainstream.

Sadly, only a handful of companies in the FTSE 100 are women-led. Perhaps more women running top businesses will lead to more investing support from the female population. This could then have a snowball effect.

Some share dealing platforms are taking small steps like highlighting firms with female CEOs. This is really encouraging to see. It will hopefully motivate more investors to support women-led companies.

The post The rise of female investors appeared first on The Motley Fool UK.

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