It’s official. A recent study by Fidelity Investments has concluded that, on average, women do better than men at investments. This may be a surprise – especially to men – as we assume that men may have a keen business sense or because they spend inordinate amounts of time in front of their computer screens reviewing various security moves.
As it turns out, that may be part of our problem. The study finds that men trade too much and are sometimes not real rational in their investment decisions.
What’s to blame? Nature. Apparently, all that testosterone floating around inside leads us to decrease our fear, cause overconfidence, and – are you ready? – increase greed. If that weren’t enough, the study also shows “too many men lack patience and need to remember that stock investments should be a 5+ years” time frame.
Let’s face it fellow males: Waiting five years for success is not nearly as fun as watching daily ups and downs of the market or playing blackjack in Las Vegas.
But men, take heart. Women aren’t perfect at investing either. The study found that women often lack enough confidence and education in this area to invest in the first place. The result: too much of their cash is often sitting on the sidelines and not invested at all. Once they get their money invested, however, they usually have more patience.
I suppose the moral of the story is that sometimes two heads are better than one. And even more often, having a professional advisor, too, to keep the testosterone – and other hormones – to a minimum is a good idea.