Why Women Are a Major Force in Investment Circles
According to a recent Fidelity study[i], a record number of women are taking a seat at the investing table and putting their money into diverse asset classes. As a knowledgeable, discerning, and committed investor group, women represent a significant opportunity for wealth management firms to attract and support:
- 60% of women are actively investing in the stock market and taking a less reactive approach to recent market fluctuations than their male counterparts.
- The number of women preparing for the long term and saving for retirement is on the rise—with 68% of women saving for retirement in 2023.
- More than half (51%) of women who invest in the market say they typically stay the course on their investments when the market experiences a dip, compared to 43% of men.
Women’s investment behaviors and outcomes
Women generally have a balanced appetite for risk, tending to be risk-aware rather than risk- averse. And as a highly responsible investor segment, women are more likely to work with an investment professional and more inclined to stick to their investment plan[ii].
Many women are getting started on their investment journeys early in adulthood. In 2022, women in the 18-35 age group first opened a brokerage account at age 21 on average and a retirement account at 20. Women aged 36 and older first opened a brokerage account at age 30 on average and a retirement account at 27[iii].
Collectively, these attitudes and behaviors deliver impressive outcomes: women are generally more successful when it comes to investing. The Fidelity study, which analyzed over 5 million investing customers over 10 years, revealed that women investors outperformed their male counterparts[iv]. When women invest, they see results.
Today’s women represent a meaningful investor segment, so wealth management firms have a significant opportunity. But capturing this segment and providing excellent service to women requires developing and honing specific capabilities.
Strategies for attracting and supporting women investors
Forward-looking investment firms are proactive about helping women reach their financial goals through careful planning and appropriate investment allocations.
In our experience, women are interested in knowing what investments are being made on their behalf and understanding precisely why. This means advisors need to be open, responsive, and able to share appropriate educational tools and resources.
There’s room for improvement on this front. Recent research[v] by Fidelity Clearing and Custody Services in the U.S. suggests that financial advisors could do more to meet the needs of their female client base. Specifically, the study found that despite their growing wealth, women report lower satisfaction with their financial advisors and their financial lives than men and less knowledge of both.
This manifests in several ways. For example, women are less likely to recommend their advisor to a friend, colleague, or family member, as evidenced by lower Net Promoter Scores (NPS). This is a commonly used measure of customer satisfaction and loyalty.
Firms should also be aware of many women’s nuanced investment preferences. Women are often especially motivated to invest in businesses to which they assign meaning and purpose[vi]. They typically take a more personal view of their investments and develop a greater attachment to the entities they channel their money into. Women are also more inclined to invest in companies with diversity in leadership and are more likely than men to gravitate toward using their investments and investment opportunities to positively impact society.
It’s equally essential for firms to look at the gender makeup of their boards and operations. Less than a third of corporate board seats are currently held by women, despite evidence that gender diversity at the boardroom level can lead to higher credit ratings and improved stock performance[vii]. Gender diversity is appealing to potential women investors: women are more likely to invest in companies that are led by, supplied by, or cater to women[viii].
Women’s wealth is growing, as is their investing footprint. Advisors, are you prioritizing your women clients? Are you engaging all members of the families you support? Women investors, we’d welcome your thoughts; do you feel prioritized and engaged?
Fidelity Clearing Canada (FCC) offers transformative technology and dedicated service to a growing customer and platform user base of women. As one of the most diversified financial companies in the world, we are dedicated to fully understanding the needs of wealth management professionals, advisors, and end-investors, and providing the solutions all stakeholders require to succeed.
For more best-practice insights, follow us on LinkedIn. If you’re not yet a client of ours, let’s mind your business. Learn more about how partnering with Fidelity Clearing Canada and our industry-leading uniFide® business platform can help you transform effort into efficiency and grind into growth!
[ii] Women and investing: The strengths of women investors | Wells Fargo Investment Institute
[iii] Women And Investing In 2023: Everything You Need To Know | Bankrate
[iv] Women and investing: The strengths of women investors | Wells Fargo Investment Institute
[vi] Women investors | Deloitte US | Financial Services Consulting
[vii] Women gain ground in the boardroom, holding 29% of director seats in 2022 | CNBC
