Women in trading
When one thinks of a boardroom, investment opportunities and Wall Street, it is not uncommon to immediately see a room or environment occupied by predominantly men, with little to no women in the picture. While phenomenons such as the glass ceiling in the corporate space exist, the same can be said for trading. Although the number of women traders has reportedly increased recently, particularly in 2021, the industry still lacks equal representation. Even though women account for a less percentage than men in the industry, they are said to be better traders, contrary to popular belief. This is because women and men tend to adopt different approaches to trading, as female stock traders tend to buy stocks when the markets are falling. While some may immediately view this as poor judgement, that is not the case. Generally speaking, these stocks may be considered a loss in the short term, however, looking further ahead, those stocks are expected to make significant gains and prove to be quite lucrative. Due to the weakening of the USD and the staggered recovery of the UK economy, the current UK share prices have been impacted, however, the USD/EUR currency pair remains one of the most popularly traded.
The Underlying myths
Many myths surrounding women in trading exist, including on the concept of Day Trading. Simply put, Day Trading is a strategy that refers to one constantly tracking market activity throughout the day in order to capitalise on any favourable fluctuations. This means that the trader refrains from keeping their position overnight, which is said to be less risky to an extent. Conversations on whether women are fit to adopt the Day Trading strategy are ongoing, with proponents arguing that gender is an irrelevant factor. Moreover, some argue that women are best suited for Day Trading because, generally speaking, they are more discipline, patient, have control over their egos and pride, and they are very detail oriented.
That being said, below are just some of the myths that exist about women in trading:
Trading is for men
As already alluded to, this is far from the truth. Trading is a mental game and requires an understanding of the markets, therefore, gender has very little to do with that. With the right guidance, tools and understanding, men and women are equally capable of being successful traders.
Women are risk averse
It is important to differentiate between risk averse and risk aware, as women can be considered the latter. Being aware of risk and how best to mitigate it is actually very beneficial to any trader, which is another argument in favour of why women are considered better traders by some.
Women are uninterested in trading and investment opportunities
This is purely a baseless assumption and generalisation that is being purported. There are several cases and reports of women pursuing trading, actively participating in the markets, and those providing guidance to novice traders who express an interest in trading.
Success stories
As noted above, there are women with success stories in the industry to share and one such woman is Chartered Financial Analyst (CFA), Barbara Stewart. She started out trading the major currency pairs for five years and has since grown her expertise to the point that she is now a portfolio manager for high-performing entrepreneurs. Similarly, Bradford Raschke voiced her trading experience by stating, in part, “You need to be good at operating in a world of probabilities and you need to excel at math and game theory. I played a lot of games like Parcheesi and Monopoly growing up and I look at the market as just another game. In general, I am not an emotional person.”
