Shenzhen, Guangdong, China–(Vehement Media – March 21, 2022) – According to a report written by Westian Global, in 2020, female investors held one-third of total personal investable wealth worldwide, up from 30% in 2016, and are projected to further increase this share to more than 35% in the next three years.
The growth in women’s investable wealth has outstripped men’s between 2016 and 2020, wrote Westian, with a compound annual growth rate (CAGR) of 8.3% versus 5.8%. Moreover, women’s investable wealth is expected to grow more rapidly than men’s over 2021- 2025, with a projected CAGR of 5.9% versus 4.3%.
Women in North America have the highest share of wealth by region, but Asia is growing quickest. In Asia, excluding Japan, women’s wealth was $4.9 trillion compared with $9.7 trillion for men in 2020. Over the next three years, Westian Global estimates that women’s wealth will be $7.4 trillion and men’s $13.8 trillion, translating into a compound annual growth rate of 8.9% for women and 7.3% for men.
The report determined that if women invested at the same rate as men, there could be more than $3.20 trillion of extra capital to invest globally, with over $1.88 trillion flowing into increasingly sustainable and impactful investments.
This is a huge market that few are specifically targeting, according to Westian Global, adding that wealth management companies should reevaluate the services they offer to focus more on the experiences and services that women are seeking in order to tap into this growing market.
Women seek advice and are often open to paying a premium for an advisor they can trust. Specifically, the Westian Global study showed that older, wealthier women are twice as likely as older, wealthy men to pay 1% or higher fees for an account managed by an advisor rather than paying 0.10% for a digital-only service.
The Westian Global report also highlighted that women generally value the need for professional advice higher than men. Furthermore, the advice women seek is often to help them achieve their objectives and linked to their goals rather than trading strategies to help them outperform the market.
Young women are also more likely to invest with a definite goal in mind, with two-thirds of young women stating this, compared with just over half of younger men. In addition, women identified honesty, experience, and openness as the leading values they looked for in advisors and institutions, said Westian Global.
When women do invest, their investments often perform better than men’s. For example, a recent Warwick Business School study determined that women investors outperformed men by 1.8% per annum.
One reason for this is women’s propensity to trade less often, and by doing so, incur fewer costs, which detract from investment performance. Women also show less of a disposition bias, for example, the inclination to sell at lows.
The data point to women being up to one-quarter less likely to withdraw their investments than men during significant downturns. They are also less likely to alter their risk profile in volatile times and are more disciplined when investing in line with their goals.
“Women also spend more time on research, are more likely to stick to a plan, and have less propensity to try and time the market. They also benefit from more diversified portfolios. So, while men tend to place more emphasis on pure performance and make investment decisions based on historical information, women tend to focus on reducing risk and making a positive impact,” said Westian Global.
Westian Global is an internationally managed firm that has been based in Shenzhen, one of the world’s top ten financial centers, since 2005. They serve clients domestically and from all around the world. Their website can be viewed at https://www.westian.com/, and there is a form on the contact us page for any inquiries about their services, or you can email info@westian.com.
Media Contact:
Vivian Po – Head of Marketing and Media
info@westian.com