Women may be closer to men in terms of attitudes toward taking investment risk than previous research has shown, according to a study by Bank of America Merrill Lynch (BofAML) that contradicts a decade of previous studies.
Eighty-five percent of women state that risk-taking is beneficial, according to a large study of 11,500 people that includes 5,000 women, which shows them differing little from men. At the same time, 81 percent of women in the survey say they feel confident they can adapt to changing market conditions and investment outcomes.
The study concludes that social status, demographics and an individual’s priorities are far greater predictors of a person’s attitude toward investment than gender. For example, 55 percent of women say they know less about investing than the average investor, while only 27 percent of men say the same thing. The answers hint that confidence levels, rather than gender, may explain any difference in investment habits.
The study also shows that 50 percent of women and 55 percent of men want to be personally involved in investment decisions. Around 51 percent of women in the study say they are concerned they would fail to meet certain investment goals, such as saving for retirement. Fifty-eight percent say their main goal is to save enough for their families while 40 percent say they should put their own personal goals ahead of those of other family members.
‘Our research reinforces the importance of concentrating on the unique, personal goals of each investor,’ says Michael Liersch, head of behavioral finance for Merrill Lynch Wealth Management, in a press release. ‘Doing so can identify a deeper understanding of the individual’s concerns and priorities, which may better align investments to achieve the outcomes the investor desires. We believe we need to change the dialogue with both men and women to discuss what really matters to them and what they want their investments to achieve.’
