Why women should invest in stocks – Business Daily
Nairobi Securities Exchange trading floor. FILE PHOTO | NMG
Studies show women investors earn higher returns than men when given the same opportunities. During these uncertain times of high inflation and falling stock prices, there is an opportunity for more women to achieve financial security. But historically, cultural bias has placed men as the primary breadwinners for their families.
It has meant that the financial services sector has prioritised promoting financial literacy amongst men. Instead of being provided with all the investment options, women are presented with the safest option.
Despite this, there is growing evidence that women make better investors than their male counterparts. According to a Forbes article by Emily Guy Birken and Benjamin Curry, women spend more time researching their investment choices.
And while they do take on less risk than men when it comes to investing, that doesn’t mean they are risk-averse. They are more likely to take appropriate risks with their investments than men. Both of these findings make for better investing outcomes.
Women are more likely to set the goals they wish to accomplish with their investment funds and think longer term. They ask more questions and plan what they want to do with their investment funds.
However, the Fidelity Investments’ 2021 Women and Investing Study showed that women still hold too much cash and may miss out on future growth.
At EFG Hermes Kenya, we believe that a financially empowered woman will impact herself and future generations. Recently, we hosted an event for women investors called She Makes Money Moves. We found that more and more Kenyan women are taking control of their finances.
They are becoming more confident in taking informed risks and want financial products and advice tailored to their life circumstances.
Investing consistently over long periods means your principal and what it earns (capital gains, dividends, and interest) combine to generate more value. Regularly investing as little as Sh100 in our stock market, you can activate the power of compounding by reinvesting the dividends you receive from your shares into the stock market.
For those investors with a medium to long-term view, investing in the heavily discounted shares of well-run companies trading on the NSE presents an opportunity to accelerate your journey to financial freedom.