Beyond the fear: Women invest wisely

Unmasking the myth of women and investment fear

For years, a persistent myth has haunted the investment world: that women are inherently more risk-averse than men. But recent data and behavioural insights suggest this stereotype may be more fiction than fact.

Dispelling the myth

A 2025 report from The Motley Fool shows that 71% of women now invest in the stock market, a notable increase driven by younger generations. In the UK, LV’s Wealth and Wellbeing Monitor found that whilst 52% of women have never held an investment product, this gap is narrowing, especially among women under 40 who are embracing equities and digital investment platforms.

When it comes to portfolio composition, women and men allocate similar proportions to stocks, traditionally considered higher-risk assets. This suggests that women are not avoiding risk but rather approaching it with intention.

Behavioural differences that matter

Numerous studies have shown that women tend to outperform men in long-term investing. A landmark study from the University of California at Davis found that men traded 45% more frequently than women, resulting in lower returns. Women, by contrast, were more likely to stay the course, avoid impulsive decisions and focus on long-term goals; behaviours that consistently yield better outcomes.

So what’s really driving the difference? It’s not fear, it’s awareness. Women are more likely to seek advice and consider the broader context before making investment decisions. This measured approach is often misinterpreted as caution, when in fact it reflects a deeper understanding of risk and its role in wealth building.

Being risk-aware means recognising volatility, understanding time horizons and aligning investments with personal goals.

All these things considered, it seems that women are not so much risk averse as they are risk aware – a valuable quality to have on your side. After all, the more aware we are of the risk involved in our investments, the more thoughtful we can be when managing our financial plans.

Next steps

Whether you’re risk-aware or risk-tolerant, your wealth manager can help you assess your comfort level, challenge assumptions and build a portfolio that reflects both your values and your ambitions.

Why not set aside some time with your wealth manager to assess your risk tolerance? They will be able to see how this aligns with your long-term financial plan.

Sources: The Motley Fool UK (2025); LV= Wealth and Wellbeing Monitor (2025); University of California at Davis Study; Stash Investing App Data; 2012 Meta-Analysis of 25 Economic Studies; Raymond James Financial; Bloomberg; Merrill Lynch; The Humphreys Group; Ellevest.