Women Are Smarter Investors Than They are Given Credit For

Women smarter investors, get more returns compared with men says ETMoney report. What does this say about women and money matters?

There is a common perception in our society that women are bad with money. They don’t know the hows, whens and whys of investment and saving. But how true is that? Women are increasingly becoming financially savvy in India, refusing to depend on others to make their financial decisions. They want to learn from experience and they are willing to take risks, all the while knowing where to begin and when to stop. And there is a report to prove it.

A report by ETMONEY found that women, as investors, have a phenomenal financial acumen. They are investing more in each calendar year. In both 2017 to 2018 and 2019 to 2020, when the markets corrected, they increased their investment amount. However, from 2018 to 2019 when the markets were on a rally, they held back. This displays how women’s approach to finances is a mix of boldness and pragmatism. They take risks when necessary, but they also know when to stop.

 

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Not just that, women investors on ETMONEY have maintained a near-perfect Equity-Debt allocation at different life stages. For the under 30 and 30 to 40 age groups, women investors have a higher allocation to equities that reverses to a higher debt allocation when they reach 40 to 50 years and the above 50 years age groups.

Also, the increase in financial savviness among women isn’t a phenomenon just limited to metro spaces. Women from relatively smaller Indian cities are coming forward when it comes to mutual fund investments. For instance, the city of Surat has seen a whopping 218 percent growth in women investors over the last four years.

This rise in awareness when it comes to investments is now bearing returns for women.

For the past four years, women investors on ETMONEY have been edging past their male counterparts with returns earned for that year. Even in 2020, the year that proved to very tough on investors, they managed to maintain the trend.

First up, we looked at something that perhaps matters the most - #returns earned. And surprise surprise, in each of the last 4 years, the average annual returns earned by women investors on ETMONEY has been 10% more than that of men pic.twitter.com/53xcjnVIPo

— ETMONEY (@ETMONEY) March 8, 2021

Hitting bulls-eye with #AssetAllocation. Women investors seem to know just the right amount to invest in different asset classes at different life stages. Their equity-debt split is spot on🎯🎯 pic.twitter.com/x4lEVnOXsV

— ETMONEY (@ETMONEY) March 8, 2021

Another aspect of investment that is important is its incorporation into saving taxes. For the last four consecutive years, women investor’s share of tax-saving investments has been around 20 percent more than that of men. Investing is all about discipline and determination and women in India have proved that they have both these qualities. For instance, when it comes to continuing their SIPs, women investors on ETMONEY have again outperformed men for each of the last four years, thus boasting a high SIP retention rate.

For the past four years, women investors on ETMONEY have been edging past their male counterparts with returns earned for that year.

The future looks promising for women as investors because they have discovered a key quality that matters in this field- confidence. Women have learned to trust themselves and their instinct, over the stereotypes that they have been fed since childhood. It is this confidence that will hopefully be passed down to future women investors, to ensure that women’s relationship with their money is that of autonomy, agency over their own funds and exhilaration that comes from watching your money grow due to your own efforts.

Article in partnership with ET Money