Women Leave Wall Street in Droves
Monday, September 20, 2010 at 5:51 pm
From today’s Wall Street Journal:
Women are fading from the U.S. finance industry.
In the past 10 years, 141,000 women, or 2.6 percent of female workers in finance, left the industry. The ranks of men grew by 389,000 in that period, or 9.6 percent, according to a review of data provided by the federal Bureau of Labor Statistics. The shift runs counter to changes in the overall work force. The number of women in the U.S. labor market has grown by 4.1 percent in the past decade, outpacing a 0.5 percent increase in male workers. The difference is pronounced at brokerage firms, investment banks and asset-management companies. [...]
[Y]oung women are becoming more rare in the country’s banks, brokerage houses and insurance companies. Since 2000, the number of women between the ages of 20 and 35 working in finance has dropped by 315,000, or 16.5 percent, while the number of men in that age range grew by 93,000, or 7.3 percent.
From a round-up of studies showing women are better investors than men, as they are likely to have lower short-term returns but are much better at avoiding catastrophic losses:
Women made fewer investment mistakes and were less likely to repeat them — or at least to admit to survey takers that they repeated them. [Merrill Lynch] said its results showed 35 percent of women said they had held a losing investment too long, while among men it was 47 percent. The worst part: Of those who did it once, 48 percent of the women and 61 percent of the men admitted to doing it again.
Similar gender differences turned up on other issues: 13 percent of women and 24 percent of men said they had bought a hot investment without doing any research. The men were more likely to repeat that mistake. “Everyone makes mistakes,” said Hannah Grove, chief marketing officer of Merrill Lynch Investment Managers. “Successful investors learn from theirs.”
The numbers come from a telephone survey of 1,000 people with household incomes of at least $75,000 and investable assets of at least $75,000. They jibe with what other surveys and studies have found.
Terrance Odean, a University of California at Davis professor who also has studied the issue, found women earn slightly better returns because they trade less frequently. Men, he says, are overconfident. That showed up in the Merrill Lynch survey, too. Women were more likely to say they are not knowledgeable about investing and more likely to rely on a financial adviser. Other studies show men are more willing to take risks and invest more aggressively than women.
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