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<\/a><\/p>\nSaying that someone does something \u201clike a girl\u201d is a common insult.<\/p>\n<\/div>\n
Actually, neither.<\/p>\n
According to\u00a0a post on blackrockblog.com, gender does play a role in affecting one\u2019s investment style and causes men and women to make different investment decisions.<\/p>\n
With this in mind, we have interviewed\u00a0Pauline Teo<\/strong>, Chief Executive Officer of\u00a08I Education\u00a0and the author of the book\u00a0Value Investing for Women.\u00a0<\/em><\/p>\n It is not a surprise that her personal investment habits fit well into the \u201cfeminine\u201d investing style.<\/p>\n Here are the\u00a0three main differences<\/strong>\u00a0between how women and men invest, as suggested by BlackRock:<\/p>\n A 2010 Boston Consulting Group study examining women\u2019s experiences with wealth management providers found that women tend to focus on\u00a0longer-horizon\u00a0<\/strong>planning.<\/p>\n In contrast, men tend to focus on the short-term track records of their portfolios as they tend to be more competitive and thrill-seeking by nature.<\/p>\n Value investing is typically seen as long-term investing, as value investors are essentially seeking\u00a0undervalued stocks<\/strong>\u00a0whose prices movements do not correspond with the company\u2019s\u00a0long-term fundamentals<\/strong>.<\/p>\n Investing-wise, Pauline is no thrill-seeker, so instead of monitoring a company\u2019s stock price on a 24-7 basis and profiting from split second price movements, she looks at a company\u2019s business model, sustainability and how sound its management is.<\/p>\n Remember how our mums\/aunts\/grandmas compared one product across multiple stores before finally deciding on which one to buy from? Such a habit might actually be helpful when it comes to uncovering the most undervalued company.<\/p>\n Of course, not every female is a penny-pincher. For all we know, there are also ladies who go on wild shopping sprees driven by emotions, only to regret it right afterwards.<\/p>\n Stereo-typically, women are often seen as more \u201cemotional\u201d beings than men, but several studies, including a national survey by LPL Financial, have shown that\u00a0men are actually more prone to market timing impulses<\/em>.<\/p>\n It is also found that women tend to set aside more time to do their \u201chomework\u201d, i.e. research on investments in depth before making portfolio decisions.<\/p>\n Pauline also exercises caution in the way that she chooses to invest within her\u00a0circle of competence. Her usual routine involves reading companies\u2019 financial reports on weekend mornings\u00a0when most of us are probably sleeping in.<\/p>\n As shown from a 2012-2013 Prudential study on women investors, women are more receptive to financial research and advice than men.<\/p>\n Also, when it comes to gathering information, women often prefer group discussions to learning independently.<\/p>\n In Pauline\u2019s case, she formed a study group where the members would meet up every month to discuss their findings of five companies.<\/p>\n Perhaps the social setting makes learning more enjoyable, or perhaps two (or more) heads are just better than one.<\/p>\n Now, in case you have not already known, there\u00a0is<\/em>\u00a0a book titled\u00a0Warren Buffett Invests Like a Girl: And Why You Should, Too.\u00a0<\/em>The funny thing is that Warren Buffett<\/a> himself agreed with the author\u2019s claim that he has a decidedly feminine investing style.<\/p>\n So how is Warren Buffett<\/a> \u201cgirly\u201d in his investing style then?<\/p>\n In short, he is known to be rather risk-averse, and instead of having unrealistic optimism towards the market, he backs his decisions with immense amounts of research.<\/p>\n He also thinks long-term, and he says that his favourite holding period is \u201cforever<\/em>\u201d.<\/p>\n Regardless of whether you like his style, at the end of the day, \u201cinvesting like a girl\u201d does not make you any less manly (if you are a man), but it\u00a0might<\/em>\u00a0make you richer.<\/p>\n1. Women tend to take a longer-term approach<\/strong><\/h2>\n
2. Women tend to be more cautious and meticulous when it comes to making investment-related decisions<\/strong><\/h2>\n
<\/p>\n3. Women are more likely to seek help from their advisors and peers<\/strong><\/h2>\n