Not very long ago, I came across a very interesting but (pseudo*)romantic title which reads like Men are from Mars, Women are from Venus. Although there is nothing to do with the financial behavior of the two beautiful creatures by the God, that still strikes many of its readers. What I (and many more readers) believe that men and women behave entirely differently, not only in their personal matters, but also everywhere, almost everywhere..!!
Well, let me come to the core issue of today’s discussion. Recently I completed my research survey as part of my ongoing Doctoral work. With that I’ve just completed the analysis of data collected from that particular survey of individuals based across the NCR. The results reveal so many interesting findings, but what made me recall that “Men are from Mars…” is the disclosure that men and women invest differently, totally differently.
From the data, it has been observed that men are far more aggressive in reacting to the news (good or bad) in the market than their fair-sex counterparts. They are likely to sell more frequently than women. You would say, “its already known, man. Men must be aggressive than women, everywhere.” Well, I would give you another finding from my research: Women are likely to acknowledge their ignorance/inability in the stock market; while men think they know well what they are doing (and more interestingly, most of the male survey respondents admitted that even if they know that what they were doing was wrong at all, still they had to go for it rather than acknowledging their mistakes or inabilities).
This makes men trade more frequently – and that at the wrong times. It can be said that men are overconfident about their skills and often lead to the wrong decisions under the influence of this overconfidence fuelled by their “they-think-they-are-superior-to-women” tendency. This overconfidence makes male investors believe that they are able to take decisions that they are really not equipped to make. So, better stay more cautious of your male mentality while making trading decisions.
Stop playing with your money, and remember the golden words by Warren Buffett: Become greedy when others are cautious, stay cautious when others are greedy.
Keep investing with FEMALE MENTALITY!!
*: I call it psudo romantic, because I donot like romantic flicks as such. I hope readers will take it positively.
Filed under: Behavioral Finance |