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Female Investors Outperform Male Investors In 2014

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Ladies, this one ought to make you smile. And I’m pretty sure there will be plenty of comments from both women and men on this article. But the numbers don’t lie. A recent study indicates that last year women did better than men when it comes to investing.

Female Investors vs. male investors on Wall Street

1The folks at SigFig shared their latest study with ValueWalk, and they said women investors actually beat men by about 12%. All graphs and charts in this report are courtesy SigFig.

They added that women with $100,000 to invest and who continued this performance trend would earn $58,000 more than a man. Additionally, SigFig reported that women beat men on a risk-adjusted basis because the median female portfolio has 74% in equities compared to the median male portfolio of 75%.

The study also found that men were 25% more likely than women were to lose money. However, a slightly greater percentage of men came out ahead of the S&P 500 in 2014.



Why did women investors beat men?

So exactly why did women do better overall on Wall Street than men did? Researchers at SigFig suggest it has to do with portfolio turnover, as men tended to churn their portfolios a lot faster than women. In fact, men churned their portfolios an average of 50% more than women.


The reason portfolio churn is probably why women performed better is because the statistic holds true in general as well. The report states that investors who had at least a 100% annual portfolio turnover rate in 2014 ended up with median net returns of only 0.1%. Those who churned their portfolios less, however, had returns of 4.7%.

Other interesting tidbits about women investors

SigFig even looked at the types of brokerage firms women used compared to men. The firm reports that men are more likely to use one that ended with the word “trade,” like Ameritrade, Scottrade and Etrade.


And what about the types of stocks women tend to favor? Women especially liked Frontier, JPMorgan and Pfizer, while men were more likely to invest in Tesla, Coca-Cola and Oracle. Interestingly, Apple was right about in the middle.


Women also tended to own funds that are more expensive than men did. SigFig also found that retirees tend to pay more than double the amount of fund expenses compared to Millennials. If retirees took some advice from Millennials about fund expenses, they would save, on average, $900 per year.


And finally, men tended to be more aggressive investors, at least when they’re younger. Researchers with the firm found that the average 25-year-old woman invests like a 35-year-old man. On the flip side, they said the average 55-year-old man invests like a 65-year-old woman.



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