Proactive Investors - Run By Investors For Investors

Why more women should trade and invest

Female stock market trader
Only 5% of professional traders are women

I've been interested in the financial markets since as long ago as 1973 aged just 7. This was the era of women's lib, bra burning, and the dawn of what is now known as feminism – something we remember on International Women's Day.

1973 was also the year of the oil crisis, which lead to tumbling share prices, stagflation and economic gloom.

It was all of this which started my interest in the markets, and I used to listen to stock market reports on the car radio going to school.

An American commentator on LBC radio called Bob Beckman predicated a great bounce for shares following the massive slump of 1974-1975 was around the corner, and it did actually happen.

I have been hooked on the markets, and perhaps more importantly, the idea of making money on them, ever since.

Just a few years later in 1979 this country elected its first woman prime minister, Mrs Thatcher, someone who arguably turned the economy around after over 30 years of decline.

For better and for worse, this country has never been the same since with the property and shareholding democracy – the “right to buy” as well as the great privatisations.

The debate rumbles on as to whether it was her monetarist policies and conviction politician approach which caused the transformation, or something she would allude to herself – good housekeeping.

Ironically, and for various reasons, Thatcher has never been regarded as a trailblazer for women, although to paraphrase the words of our current Prime Minister, Theresa May may remind some of us of the former Tory leader.

In fact, Mrs Thatcher was actually more of a class warrior and somebody necessarily pro-women. Her message seemed to be that it was and is merit, which is the most important thing to focus on, rather than necessarily trumpeting someone's gender.

This may be just as well, but since I have been working in and around the City of London – nearly 30 years, the impression has always been given that it is a place run by men for men.

The problem of course is that many of the issues which arise from this foundation of the greed is good  / dog eat dog mentality filter through to the real world. They may include the vast equality inequalities in pay, opportunity and workers rights.

It does not appear that things are necessarily getting better, with zero hours and dress code battles new and ongoing phenomena.

The epitome of all of this in the recent past has been Sir Philip Green, a man who stripped BHS bare, and then gave back the equivalent of half a super yacht in order not to be stripped of his knighthood.

While it might be wrong to suggest that Sir Philip's legacy could not have been delivered by a woman, his lack of humanity would appear to be unique to an ageing male in midlife crisis.

But getting back to the issues are paying equality and opportunity, even with all the legislation it is very often the case that women earn significantly less than men, and many even with money do not have the financial knowledge and understanding to manage this via the financial markets in general or the stock market in particular.

If there is anything to be done at as young age as possible it is to educate everyone to be financially literate, at least to a basic level, and eliminate the idea that money and investing is a man's game.

However, in terms of where we are now, there is little doubt that trading is a man's game. Only 5% of professional traders are women.

That said, as much as a third of new enquiries regarding trading have been reported by a U.S. source as being from women. While one might query such a statistic, the trend of greater female interest in this area is undeniable.

Unfortunately, if we want to take accelerate matters, it is not enough to use a rare role model such as Nicola Horlick – fund manager – to somehow extrapolate that the playing field is level.

Understanding how money works is an essential part of being empowered, whether male or female, or these days, whatever gender you assign yourself.

One very erroneous impression that many have is that one requires a lot of money in order to make money. This is not the case.

Indeed, it may very well be the case that with online trading and investment platforms, and direct access to the market, this is both the most appropriate time in history to see whether you have what it takes to become anything from a long-term investor in the Warren buffet style, or that rare breed, a day trader?

My experience, from being a broker in the 1990s, is that the main mistake all newbies make in the market whether trading or investing is to trade too big, too soon.

You do not have to be Sigmund Freud to realise this approach is very much the sin of the male.

The other big error is not to fear risk, but actually trade the markets at the riskiest times – rather than avoiding them: another typically male trait.

Perhaps even just these revelations already tip the balance in favour of women making money on the markets – if only they embraced the #BEBOLDFORCHANGE hashtag of International Women's Day?

My view is everyone should at least try trading investing – just in case they turn out to be the next star fund manager, investor or indeed, daytrader.

© Proactive Investors 2019

Proactive Investors Limited, trading as “Proactiveinvestors United Kingdom”, is Authorised and regulated by the Financial Conduct Authority.
Registered in England with Company Registration number 05639690. Group VAT registration number 872070825 FCA Registration number 559082. You can contact us here.

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use