O.T. Yamakita, I been digging and hit paydirt! (I already posted this on PCCLF & SFTBF boards--could not resist)
Women beat men in share market --Study shows their portfolios earned 1.4 percentage points more a year
By Neil Behrmann
THERE can be little doubting it any longer -- women are better stockmarket investors than men. The University of California studied the results of 35,000 stockbroker clients in the US and found that between 1991 and 1997, ladies earned 1.4 percentage points per annum more than men in their stock portfolios.
The study found that single women did far better than their male peers and their profits were 2.3 percentage points better annually.
These figures may sound small, but over time, the compound gains can be significant. Over 10 years, for example, an annual 2.3 percentage point margin over males comes to 26 per cent.
Female investment clubs also outperformed their male counterparts, the study found. Their annual compounded return amounted to just under 24 per cent compared with the 19 per cent achieved by males.
The five-point difference is even more significant because it works out to a whopping 71 per cent over 10 years.
The American study confirms a recent British survey that reached pretty much the same conclusions.
A City ShareShop quarterly survey released in December showed women across all age groups in Britain reporting 5 per cent higher profits from share investments than men.
That survey also found women choose Internet stocks before IT and high-tech companies, the reverse being true for men.
The University of California study findings were reported by stockmarket commentator Luke Johnson of the Belgo Group in a recent report.
Mr Johnson attributes the better performance of women over men in stock picks to common sense, loyalty and being generally more faithful. Women also follow companies that they understand, he says.
He may have a point. Several women investors BT spoke to, for instance, had cautioned well before Marks & Spencer's two-year stock slump, that the UK department store was lagging behind in its ladies' and mens' fashions.
The strategy of Bernice Cohen, a now well known 63-year-old British investor with her own Web site (www.Mrs Cohen.com), may provide some clues as to the investing habits of women.
Mrs Cohen says that after five years, her money has grown four times over although "I have made uncountable mistakes".
She writes in her Web page that her stock picks have helped her repay her debts, including taking only nine years to repay her mortgage.
"Prior to 1997, the bulk of the portfolio centred on holdings in small growth shares," she says.
"There were plenty of losses but among the great successes were BTG, a privatisation issue catering for the commercialisation of intellectual property rights and patents, and British Borneo, the oil exploration company."
Like well-known investor Warren Buffet, she also invested in companies whose businesses she understood.
"I made several successful investments in retailing companies, including Carpetright, the carpet stores specialist, Games Workshop, the hobbyist chain, JJB Sports, for fashion sportswear and Betterware, who sold household goods, door-to-door."
Betterware was taken private in a management buy-out in 1998.
But she differed from Mr Buffet in one key area: She rode the technology boom, instead of shunning it. "From a very early stage, I was a great fan of high technology, software companies."
She invested in several information technology companies, including Psion, the organiser and palm top specialist. "At various times I also held shares in Perpetual, British Aerospace and Railtrack," she writes.
business-times.asia1.com.sg |
