Investing and trading for women



As an increasing number of female traders and female investors enter the market, it has become more evident that trading and investments are no longer gender-specific. With stock market trading and financial advisory now becoming increasingly more accessible for everybody, women from all walks of life are finding it easier to take the leap and start their own financial journey.

Women vs. men as investors and traders: How do they compare?

When you think of an investor or a trader, you’ll undoubtedly - almost naturally - picture a man. But this kind of deep-rooted conditioning aside, the ground reality shows us that not only are more women entering the markets with confidence, but, as it turns out, they may actually make for better investors.

There are certain attributes exclusive to female investors and female traders that gives them an edge over their male counterparts. More specifically, women are more conscious of risk, and they are willing to seek professional advice and actively research things they are unsure about. And interestingly, they are often less impulsive when it comes to making investment decisions.

These attributes can be summed up into three key areas:

  • Risk aversion
  • Self control
  • Research

Perhaps this is why the portfolios of female investors and female traders outperform those of their male counterparts, as many studies have shown.

Investing for women: What should you know?

Investing for women has gotten easier with time. As you’ve seen in an earlier chapter, there are many women-centric investments in the market these days. Nevertheless, if you’re still getting started with your investment journey, you’ll find these pointers useful.

  • Make use of the power of compounding

Compounding is a powerful tool that has the potential to significantly multiply your returns if given enough time. It gives you the ability to reap returns from returns. For instance, the next time you receive dividends from your stock investments, you could reinvest it in the same company. When you continue to do this over a period of time, you not only increase the number of shares that you hold, you also get to increase the amount of dividends.

  • Continue to educate yourself

They say that education is a never-ending process. That saying holds true even when it comes to investing for women. In finance, there are many developments constantly taking place, and each of these developments has the potential to steer the market movements or change the way your investments grow. So staying aware of all the recent developments can give you an edge and help you plan your finances smartly.

  • Revisit your portfolio periodically

The stock market is a volatile environment, where the trends tend to keep shifting over time. And so, to ensure that your portfolio performs according to your expectations, it is essential to revisit your portfolio periodically. This way, you would be in a better position to make the changes necessary to stay relevant with the market scenario.

  • Don’t be afraid to take more risk

Female investors have often been touted as conservative investors. While this does come with its own upsides, it also never hurts to take a bit of risk. Remember that with higher risk comes the possibility of better rewards. And so, if you find yourself with a very conservative portfolio, don’t be afraid to introduce a little bit of risk into it if you have the appetite for it.

Trading for women: What should you know?

Stock market trading for women is another area of finance that is seeing increased participation in recent years. Women traders are showing greater interest in intraday trading and other short-term market opportunities. If you’re looking for some guidance to help you get started, here are some ideas that can help.

  • Choose a stockbroker you can trust

The track record of your stockbroker is really important considering that all of your trading orders go through them. Ensure that you partner with a broker that you can depend on, and one whose customer service and brokerage plans you are comfortable with.

  • Do your own research

This is a major point that female traders need to follow. External research from traders and experts may be helpful to a certain extent. But remember to always conduct your very own extensive research before taking any trading decision. Being skeptical helps in the world of share trading.

  • Practice, practice, practice

If you wish to learn something, there’s no substitute for practice. And so, before you get into the real deal, ensure that you practice trading thoroughly till you get the hang of it.  There are plenty of paper trading apps and stock simulators that you can use for free to get accustomed to share trading.

  • Keep pace with the newest innovations

The world of the stock market is constantly evolving. New technological innovations such as rule-based trading are fast making their way into the mainstream market. And so, it is important that you keep pace with these new developments to stay ahead of your game.


Wrapping up

Well, that’s about it for this chapter on investing and trading for women. Just keep the above points in mind whenever you invest or trade, and you should be well on your way to getting better at it. In the next chapter, we’ll take a closer look at financial planning for women.

A quick recap

  • Investing for women has gotten easier with time. 
  • If you’re looking for pointers to get better at investing, the first thing you need to remember is to make use of the power of compounding.
  • Continue to educate yourself about investments, revisit your portfolio periodically, and don’t be afraid to take more risk.
  • As for trading, choose a stockbroker you can trust and do your own research.
  • Practice trading before you get into the real deal and keep pace with the newest trading innovations.

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To get started with trading in the stock market, women need to open a demat account and a trading account, and have the bank account linked with them, so trading becomes easier.
To make the most of compounding, you need to start investing early, remain invested over the long term, and invest consistently. With these three areas covered, you can rest assured that compounding will work its wonders on your investments.
A 3-in-1 account is a combination of a demat account, a trading account and a banking account. These three accounts are interlinked, making it easier for you to pay for the shares you buy through your trading account, and to store them digitally in the linked demat account.
Open an account