Anything men can do women can do better, at least when it comes to investing during the recession. This could change everything … By Jennifer Armstrong

Turns out we all could’ve been making bank by building stock portfolios—if only we’d known we were good at it! That is, better than men: The Wall Street Journal pointed out that finance professors Brad Barber and Terrance Odean “have found that women’s risk-adjusted returns beat those of men by an average of about one percentage point annually. In short, women trade less frequently, hold less volatile portfolios and expect lower returns than men do.” Translation: Investing is one more thing we’re good at that we’ve been told we aren’t. And we’re even better in a recession. The reason we’re awesome at it is because we weigh risks more carefully and tend to diversify more—we simply don’t trust our nest-eggs to others easily. The Journal even goes on to further posit that women simply don’t brag about their gains, which is why high-finance remains a man’s game.

This comes as truly startling news, even if the explanations make intuitive sense. The only conversations I have with girlfriends about money revolve mostly around not having enough. Though that might be related to the reluctance-to-brag part of the equation. The gals on “Sex and the City” didn’t dish about their NASDAQ returns over brunch, after all. And I wonder, too, if some women might even outright resist investing because it takes earning more than a potential suitor to another level—I simply can’t imagine a scenario in which it would be advisable to mention your booming stock picks on a first date.

I wouldn’t know, though, as my personal relationship with finances has been particularly fraught. I grew up in a household where we lived in denial of money issues and paid dearly for it later. I’ve never liked the power it seemed to have over everything from relationships (my ex judged my monetary skills harshly, and I don’t blame him) to cultural opportunities (concerts are an “essential expense,” right?) to social connections (drinks are an “essential expense,” right?). But I’ve also always fallen back on another excuse—that I simply don’t know what I’m doing when it comes to higher-level finance (i.e. investing), so why even bother? I’m not proud of it, but I’ve even hoped I would find a boyfriend/husband who could just handle that for me. I’m honestly so averse to gold-digging that I’ve ditched dudes because they had too much money (it just makes me uncomfortable), but I am apparently an investment adviser-digger. Which doesn’t quite have the same ring to it.

Hearing that girls are actually good at investing changes things, though. This is like the Title IX of financial news. Next time I’m talking to other women about money, maybe I’ll ask about their portfolios instead of about their rent payments or shoe price tags. I might get a stock tip or two—or at least further proof that women really can do anything.

Do you invest on the downlow? Do you talk finance with friends and lovers? Have any stock tips for us? Tell us on our message boards below.

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Tags: feminism, investments, money, recession

This entry was posted on Sunday, May 10th, 2009 at 4:33 pm and is filed under Being A Siren. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.