According to 72% of millionaires, smart investing is the key to financial success. In fact, the majority of millionaires’ main source of income stems from investments. For this reason, it would be wise to assume that all financially-ambitious individuals participate in investing.
However, a survey by Hargreaves Lansdown reveals that 70% of women don’t have any investments. So, why is it that women are missing out on this huge earning potential? And how can the gender gap be improved?
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The investing gender gap
Data from Hargreaves Lansdown reveals that 70% of women don’t hold any investments, compared to 59% of men. Both men and women said that the main barrier to investing was not having the right funds.
Although men and women share the same concerns about funding their investments, it seems that a gender gap exists when it comes to confidence.
The second most common reason women give for not investing is that they don’t not know enough about it. The data shows that this is the case for 31% of women compared to just 22% of men. The survey also shows that men are more likely to give the correct answer to an investment question. This is despite the research showing that men don’t have a higher level of knowledge about investing than women.
Furthermore, while men are more likely to give the correct answer, they are also more likely to be wildly wrong. The survey shows that women are more likely to overestimate investing risks and underestimate investing rewards. This could prevent women from making investments.
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How to improve trading confidence
Investing comes with its risks, which can make it a daunting endeavour for any individual. Nevertheless, investing is a great way to build wealth and improving investing confidence is key to closing the gender wealth gap.
Here’s how you can improve your trading confidence.
Knowledge is key
It is impossible to feel confident about investing if you know nothing about it. The most successful investors continuously build their knowledge and learn new investing skills every day.
Benjamin Franklin once said, “An investment in knowledge pays the best interest.” In terms of investing, this means that those who take time to learn have a higher chance of success. With the right knowledge to hand, you will be able to place smarter investments. It may take some time to build up the knowledge that you need, but patience is a virtue!
Start small
While all investors dream of building a million-pound portfolio overnight, smart investing is built up gradually. If you’re wary about making your first investment, start small and slowly add more funds as your confidence increases.
Contrary to popular belief, you don’t need that much money to start investing. You can open up an account with as little as £50 and slowly increase your funds. It’s better to start with a small investment than not starting at all!
Learn from experts
If you find yourself feeling lost in the world of investing, it might be a good idea to seek expert guidance. While some investors sell mentoring services, there are also many experts who share their advice for free!
Try to find experienced investors who have an investment strategy that appeals to you. Then, head to Google and see if they have a Twitter account or blog on which they provide insight into their strategy. If you’re lucky enough to know a successful trader, it’s a good idea to reach out to them also.
You can never go wrong by learning from the best! When using an expert for investing guidance, always remember that the stock market can change. Even the most successful investors can make poor decisions and most will learn from their mistakes.
Get a handle on your emotions
Emotions play a huge role in successful investing. The best investors will stick to a clear, informed strategy even in times of fear or excitement. Before you start your investment journey, it is important that you fully understand the risks involved with investing and that you learn to control any fear that might be related to this.
Emotional investing can lead to rushed decisions and poor investment choices. The best way to handle your emotions and feel more confident is to ignore information that is out of your control. You should also try to focus solely on your strategy and make sure you’re prepared in the event of a loss.
