In a 2013 Spectrem research study, investors were asked to select a preferred financial advisor from a group photo of eight people, four men and four women, with obvious differences in ages.
The oldest male in the photo was chosen by 35% of investors, followed by the next oldest male with 26%. Two women in the photo received 12% of the vote.
While there was no right or wrong connected to the question, research shows that investors should consider female financial advisors a little more strongly.
There are facts related to men and women and their attitudes toward risk that require no study. Women are more likely to wear seat belts; men are more likely to drive fast. Women go to the doctor regularly; men go only when their bodies tell them to.
Aversion to risk plays an obvious role in investment decisions. Success in investments can be attributed to both an aversion to risk as well as a willingness to risk.
In Spectrem’s Millionaire Corner study Investment Attitudes and Behaviors of High Net Worth Women versus High Net Worth Men, 61% of men said "taking risk” was a factor in their obtaining wealth, while 43% of women said the same thing.
Asked to respond to the statement "I am willing to take significant investment risk on a portion of my investments in order to earn a high return on my investment", 43% of men and only 28% of women agreed.
Women are also more likely to credit their financial advisor for their accumulation of wealth. The Spectrem study showed that 43% of women credited decisions made by their financial advisor while only 33% of men did so.
According to the Spectrem study, 78% of women use a financial advisor of some sort, while only 72% of men do. Eighty-eight percent of men consider themselves either knowledgeable or fairly knowledgeable about financial products and investments, while only 63% of women feel that way about themselves.
Fifteen percent of women consider themselves advisor dependent and that jumps to 23% of women in the ultra-high-net-worth wealth segments, with a net worth between US$5 million and US$25 million. Only 11% of men are advisor dependent, and that percentage is consistent throughout wealth segments.
The desire for information from others indicates patience in investing, which can lead to avoiding mistakes made by rushing into an investment.
Risk aversion, or its opposite, the thrill of risk, plays a role in the feelings men and women have toward investing in general.
The Spectrem study reveals that 54% of men enjoy investing while only 36 percent of women admit to enjoying the investment game. Women remain consistent among wealth segments, while 68% of investors with a net worth of US$5 million or more say they like investing and do not want to give it up.
Obviously, men get something out of investing that women do not.