Why the stock market is still a man’s world

For historic and perhaps also hormonal reasons, women are far less experimental when it comes to the stock market. There are of course many exceptions, but for the most part you are far more likely to overhear two men discussing the day’s trading than a pair of women. This in itself is not problematic for women, especially as taking a gung-ho approach to the stock market often ends in tears.


Their ambivalence toward the market is, however, indicative of a level of distrust and a lack of understanding of how markets actually work, which is problematic. When you don’t understand how something works, it’s natural to fear and avoid it. And by avoiding markets altogether, many women who do have the means to invest are missing out on an opportunity to grow their money – albeit in the long term. While those in the financial community have long known of this tendency on the part of women, the results of a recent Visa survey put some numbers to it.


According to the survey, only 2% of women invest directly in shares and buying shares tops the “worst investment choice” rankings among those surveyed. (The report surveyed 2 000 women from all income groups across the country who have household financial decision-making responsibilities.) As a result of their skepticism toward the stock market, many women choose to rather keep their savings in cash, which is arguably even riskier.


“Women tend to be very conservative with their money and often avoid growth investments, such as equities, to the detriment of their long-term investment returns,” explains personal finance expert, Maya Fisher-French. “While cash may be suitable for shorter savings goals like weddings and house deposits, it’s not appropriate for medium- and longer-term goals like children’s education and retirement.” She explains that many women believe that, should they require access to their money quickly, they might not be able to access shares. “Women are also not getting neutral [financial] advice – they’re getting biased advice from partners or family members – whereas they should be getting more advice from financial advisers.”


In addition, many believe that you need a lot of money to invest in the stock market, which isn’t necessarily true – you can get started with R500/month. Clearly, members of the fairer sex are missing out on a trick here. “There is a lack of understanding [among women] and appropriate education about the benefits of investing in shares,” insists Sunel Veldtman, an author and financial adviser. “Also, women are more risk averse. There is debate about the reasons – some say it’s physiological, for example, they have less testosterone and more of the nurturing hormones that cause them to avoid risk and some say it’s due to the way girls are socialised… I reckon it’s a bit of both.”


Ironically, research conducted by several US brokerage houses and universities into the trading patterns of women and men have actually shown that women are better at share investment than men. “We speculate that the reason is that women are less overconfident – a proven behavioural pattern that destroys investment returns,” adds Veldtman. So if women were to take more of an active interest in the stock market, chances are they will have some success.


So how can women be encouraged to take a bolder and more proactive approach to their finances? Fisher-French believes that more female role models are needed, as well as more female financial advisers and asset managers. “Most financial advisers are men, and many women may feel embarrassed to discuss their savings and how much they have to invest,” she explains. “They may feel more comfortable talking about it with a woman, who will ‘speak the same language’.”


Veldtman is adamant that more education is the key: “I do regular workshops for women and I’m reminded all the time of the lack of knowledge of even the most basic personal finance issues,” she says. “Young people receive all sorts of life skills education now, but personal finance education is still lacking! I don’t think the problem is limited to women, but many women still have the Cinderella complex – hoping for a man to save them.”


Jessica Hubbard



Gary Belsky – an American author who lectures on sales psychology, behavioural economics and decision making to businesses – gave five reasons for why he believes women, by their nature, tend to outperform men [on the stock market] when the playing field is otherwise level:

  1.  They’re quicker to admit ignorance.
  2.  They’re more likely to seek help and advice from others.
  3.  They’re better at specific goal-setting.
  4.  They do more “homework”.
  5.  They’re generally more cautious about risk

What is the Cinderella complex?

The Cinderella complex was first introduced by author Colette Dowling, who wrote about women’s fear of independence as an unconscious desire to be taken care of by others. The complex is named after the fairy tale character Cinderella and is based on the idea of women that the story portrays: as creatures that are beautiful, graceful and polite – but who cannot be independent characters themselves and who must be “rescued” by an outside force, usually a man (and preferably a dashing prince!) For a man, it may be flattering to have a Cinderella in his life (if not expensive), but for a woman – it’s decidedly risky to be a Cinderella – if not downright foolish.


  1. Good article.My view is that the “Cinderella Complex” is generational – applicable mostly to baby boomers and
    to a certain extent generation X ‘ers. I look around my social circle and most women of the “Y”Generation are very financial
    savvy and entrepreneurial.

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