Stock Trading: Are Women Traders Better than Men?

When people think of stock traders, they usually picture men performing the activity. For some reason, women are less likely to be pictured as traders, even though the trading scene is very diverse and includes more and more women as time goes by. However, the increasing number of female traders is not the only thing that has been noticed in the past years. In fact, it has also been discovered that women may be better traders than men.

Is this really the case? Are women better at trading compared to men? Keep on reading to find the answer.

The Difference Between Male and Female Traders

At first glance, despite the different genders, it may not seem like there’s a huge difference between a man trading and a woman trading. 

Trading is the same for everyone: it can be challenging, and it requires a lot of information, attention, and strategy-making. 

But based on some trading trends, women have a different way of thinking compared to men when it comes to stock trading. These differences are also why it’s now considered that female traders are much better at investing than male ones. 

A study found that women usually go for multi-asset trading and equities. Men are more likely to go for something like currencies and crypto. Most of the time, women only get involved with things they actually understand, so they only invest there. 

Also, it seems that unlike men, who usually go for intraday trading, women like short-term trading more. In short-term trading, there are fewer trades involved. At the same time, the investor keeps the shares for longer, which can be an advantage. On the other hand, intraday trading uses asset price changes that happen every hour or every minute, which means there is more buying and selling activity. 

Furthermore, men have larger portfolios and take more risks, while women are less willing to take risks and have smaller portfolios. And it doesn’t stop here – when it comes to average deposits, women go for smaller amounts compared to men. 

Women are also more inclined to set larger stop-loss orders. Then, before the order gets traded, they close a trade manually. In the meantime, men usually set much smaller stop-loss orders and are more likely to either move them or cancel them. This goes to show that women have a higher likelihood to stick to their decisions in trading compared to men. 

Why Are There So Many Differences Between Men and Women Who Trade?

It’s hard to figure out why the difference between male and female traders is so huge. However, studies have looked into this and found some possible reasons. 

Women are quite contrarian compared to men when it comes to stock trading. Female traders purchase stocks when there has been a major price drop. Then, the stock is being sold to male traders after the price has a significant boost. Moreover, because they buy during price drops, they lose money in the short term, but as the prices grow and they sell the stocks, they can gain more cash in the long term. 

This goes to show that women are more informed than men in terms of how to buy and sell. They always buy cheaper and then sell the stocks when they get more costly. 

Female traders can more easily pick up on market trends compared to males, so they do not let the idea of fast-rising prices charm them into taking action. They can control themselves and wait for the right moment, which helps them a lot in the long run. 

Not only that, but they are also better when it comes to managing losses. They know that things are very likely to go wrong in some cases and don’t dive carelessly in hoping that their suspicions may be wrong. In fact, when they expect the risk of losses to rise, they use better tactics to prevent the loss. 

The Bottom Line

Women who want to trade on MT4 platform or MT5 platform, as well as other trading platforms, might be better at trading than men. Studies show that women are more cautious, controlled, and patient than male traders, which is why they usually experience fewer losses and greater wins. 

Not only that, but women also have higher education and financial literacy compared to men, with 50% of women having bachelor’s or master’s degrees and only 37% of men having a degree. Overall, studies show that women are better at stock trading.

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