Insight: Why women are better investors than men

Wall Street and men in suits are inextricably linked. But is this image justified? Is the image of women not being able to be decisive in financial markets really true? In short: yes. However, this is a good thing for women. On average, women tend to be more risk-averse than men. Consequently, men are more likely to trade financial assets often. Men are more influenced by short term losses or gains, because they like risk more. They have a higher intention of selling a stock that went down right away, so they can invest this money in other assets that seem more profitable. On the other hand, when men own a stock that did well, they are more likely to sell that stock and invest it in another stock (with higher risk) to gain even more profit. But this is also the reason why men tend to do worse than women. On average, both men and women gain the same revenues. The problem for men is: they incur more costs, transaction costs that is. So, because women are able to focus on the long term and therefore hold stocks longer, they incur less transaction costs than men and will on average gain a higher profit than their male counterparts. Maybe it is time for women to take over Wall Street?