Large banking institutions have been committed to diverse hires for the past few years, welcoming an influx of different ethnicities and genders into the mix of their cohorts.
In 2018, JP Morgan launched its Winning Women Undergrad Programs with the aim of promoting ‘diversity of thought, experiences, backgrounds, and perspectives. Goldman Sachs established its Women’s Trader Academy programme in 2019 to provide a launchpad into the world of banking for female fresh graduates. Morgan Stanley has its own Women Without Limits programme, ‘committed to creating opportunities for women in their wealth planning’.
These programmes were created to level the field on the trading floor and to cater to an increasingly diverse clientele. But while banks take on more female recruits, do these recruits end up serving female clients?
The answer is – yes and no.
There is certainly a rise in female retail traders around the world. With the accessibility of trading tools and tutorials, women are more equipped on this front than ever before. Many of them trade whenever they have a spare window of time – be it on the subway to work, during their lunch hour, or right before they go to bed. The pandemic has also seemingly urged many to take to trading.
In 2020, Copenhagen-headquartered Saxo Bank reported an increase in female investors of 354% overall, compared to men’s 288%. JP Morgan surveyed 4,000 women across 10 European countries in 2021 and discovered that 78% of those who invest have a financial plan with clear objectives. A study by BrokerChooser also reported that the highest proportions of female traders are from the Philippines at 44%, Barbados at 39%, and Trinidad and Tobago at 38%, proving that women of all backgrounds are taking to trading.
However, these promising statistics pale slightly when we look at the wider picture. While most women invest strategically, only 18% of the 4,000 women surveyed by JP Morgan invested at all, with many preferring to save in cash. The same BrokerChooser study revealed that out of 123 markets, men dominate all of them, with women accounting for only 24% of traders on average.
So, what’s keeping women from investing?
According to several studies, some women do not trade because they are paying down their debt, while others do not know where to start. Among those that do not have a debt to pay and have access to trading tools and tutorials, many of them do not invest due to fear.
This is less than ideal for three reasons: women live longer than men on average, and therefore need more retirement funds than men. With the rapid rise of inflation, investing is also one of the few options of making sure our assets do not depreciate or diminish. Lastly, when we dare to trade, can do it – in many cases, we even make better investment decisions than, and outperform, men because we are more likely to know our risk.
The journey towards financial freedom is crucial for us women, and it is one paved with knowledge and courage. When we invest in the right stocks, we are also investing in ourselves. As we get more comfortable and confident, our income streams diversify, and we gain another viable avenue towards financial security in the long term.
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