Why women are taking the trading and investment reins
By BRANDVOICE
BRANDVOICE
Investing and financial markets have historically been a male-dominated industry that women have found difficult to access. However, the multi-billion dollar trading and investment market is experiencing an increase in the number of young, highly motivated female investors. A generational shift, greater financial literacy, technology changes, access to content and improved education have contributed to the change.
The changing face of investors
CMC Markets Head of Marketing APAC & CA, Alicia Tan, says the increase in female investors is being led by a drive to take wealth generation seriously; “Traditional wealth generation – especially through property – has in some cases become unattainable due to increasing property prices. That is not just for women but men, too. For that reason, many are looking for alternative ways to grow their wealth.” She also added that lower trading costs have also made investing more affordable comparably, contributing to the increased interest in investing.
The accessibility of investment options has also significantly contributed to the number of females joining the market, giving them more control over their investment or trading journey.
“As everyday access to financial markets has improved through apps and other platforms, so has female interest and confidence in proactively growing their wealth,” said Tan.
In financial markets across Asia, women holding positions of power in financial decision-making, trading , and investing is the cultural norm.
While this is not the case in Australia, there has been a marked shift over the past few years that has seen more Australian women investors and traders join the market.
Since 2020, there were 1.2m Australians who entered the investor space. 50% of these were females.
This rise is notable among next generation investors (those aged between 18-24), with the percentage of female investors increasing from 9% in 2020 to 11% in 2023, according to the 2023 ASX Investor Study.
Financial literacy is growing
CMC Markets Head of Distribution APAC & CA, Michael Bogoevski, says that females are joining the market thanks to the flow-on impact of improved financial literacy and education of women and girls.
“Statistically, we are seeing changes in women as investors or traders. That has come down to several reasons, and it was happening pre-Covid. Young females [as investors] are a big growth area. Financial independence and the changing dynamic, in terms of point of access and the information and content people are reading, is leading a demographic change,” he says.
Improved financial literacy has also led to improved levels of confidence in women as they back themselves as proficient investors and traders.
Bogoevski says financial education and access to financial market for women has improved over the past 15-20 years, however, the flow-on impacts have taken time.
“It’s no surprise that women are only gradually becoming more aware and confident in online investing and trading.”
For Bogoevski, it is a change he has noticed not only within the industry but also at home. His wife, Sasha, who previously showed “no interest whatsoever” in trading, is one of those 600,000 females who started investing since 2020.
“My wife, over the past year, has started taking an interest in ETF investments, having her own framework and investment plan. [Sasha is] asking herself: ‘How do I feel about the world? Do I have the conviction in the trade investment and then actually executing it and watching it and being comfortable with it?” Bogoevski says.
For many women like Sasha, investing and trading became more accessible because of readily available information and content, as well as technology giving her accessibility and empowering her to take control of her financial future.
“I think my wife’s experience could be similar to that of a lot of women investors we have seen join the market,” he adds.
Why women investors and traders?
Tan says women, as investors and traders, can have a different financial decision-making approach to men, which can be beneficial from an investing perspective.
“Level-headed decision making can make a big difference when you’re trading. You can get so wrapped up in your own mental psyche… and it’s important that you’re able to keep yourself in check and not get overly bullish.
“We tend to find our female ALPHA CFD traders are really disciplined. They stay informed, anticipate key trends and monitor price actions, especially during volatile periods – they are meticulous,” Tan says.
“For more women to start their investing journey, education is key to overcoming the problem. Financial education and confidence building needs to start early.” Bogoevski says.
“It starts early with financial literacy and education, and it is something that I talk to my young daughter about a lot. I want the messaging to be right.”
What does the future hold?
Tan hopes investment in female-led literacy continues: “Women make decisions differently. They want to know they’re heading in the right direction and the journey aligns with their goals as opposed to just knowing how to do it. The way this information is communicated to women of all ages matters, so financial literacy or investing programmes really need to reflect that to drive increased female engagement.”
CMC ALPHA, a leader in premium investment and CFD trading with access to local and international markets, has noticed more high-net-worth women are taking an active interest in trading.
When looking at trading behaviour over the last three years, CMC has seen a 13% increase in female ALPHA traders in Australia and a 7% decrease in their male counterparts.
It is this growing influence of women in finance that the CMC team recognise and is pivoting to support through personalised high-end service and premium support.
DISCLAIMER: Seek independent advice and consider the relevant Terms and Conditions at cmcmarkets.com.au when deciding whether to invest in CMC Markets products. CMC Markets Stockbroking Limited (ABN 69 081 002 851 AFSL No. 246381).
