Men statistically exhibit a higher propensity than women to engage in stock market investment.
The latest YouGov survey, commissioned by the German Press Agency, has shed light on a persistent gender disparity in stock and fund investments, with men investing more than women. The survey, conducted online from June 25 to 27, 2021, with 2,043 participants, revealed that 43% of male respondents invest in stocks or funds, compared to 24% of female participants.
The disparity is attributed to differences in financial confidence, investment behavior, and risk preferences between men and women. Studies show that only about one-third of women feel confident about their finances, compared to nearly half of men. This lower confidence can lead to less engagement in investing and trading activities among women.
Women tend to be more risk-averse and often prefer investing in companies with social responsibility, whereas men are more likely to invest regardless of such considerations. A 2020 survey found only 19% of women would invest in companies lacking social responsibility versus 51% of men.
Women often gain financial confidence and literacy through experience in managing finances. However, widespread part-time work among women and their role in managing household finances do not fully translate into trading and investing confidence or participation.
Persistent stereotypes and social norms about gender roles regarding money management and investing also contribute to the lower investment participation of women, which further widens the financial gender gap.
The survey did not specify the geographical location of the respondents, nor did it provide information about the age range or total number of respondents. However, it did show that among respondents over 54, the proportion of small investors is 27%, while among the 18-24 and 25-34 age groups, the proportions are 42% and 44% respectively.
Investing and trading are essential for long-term financial growth and independence. The gap in investment participation not only reflects income inequality but also risks leaving women financially vulnerable over generations if unaddressed. Encouraging financial education and confidence-building among women is critical to closing this gap.
Gerrit Fey, the chief economist of the German Institute for Securities Research, stated that the difference in investment level has remained more or less stable over the years. Experts say that men tend to invest more than women internationally.
The survey did not provide information about the investment volume of female investors, but it was mostly below 250 euros. Half of those who do not invest in stocks or funds say they don't have enough money left over, with 48% of women citing the same reason.
In conclusion, the YouGov survey's findings on gender disparity in investing underscore a complex interplay of confidence, financial literacy, risk tolerance, and socio-economic factors that lead men to invest more frequently than women. Addressing these factors is crucial to promoting financial equality and ensuring long-term financial stability for all.
[1] Source: YouGov survey commissioned by the German Press Agency, 2021.
- What could potentially help bridge the persistent gender disparity in finance and investing, as seen in the YouGov survey, is encouraging financial education and confidence-building among women, given that only about one-third of women feel confident about their financial situation, compared to nearly half of men.
- Owing to differences in financial confidence, investment behavior, and risk preferences between men and women, women are less likely to invest in stocks or funds, with only 24% of female participants in the YouGov survey expressing involvement in such activities, compared to 43% of male respondents.
