Beth Frazier always gad a hunch that women make better investors than men.
"We don;t have enough time to trade as frequently, so we tend to leave our money in there, it grows over time." said Beth Frazier, Organizer of Women's Investment Club.
It turns out she's right. Women do fair better, and it's because they trade less. That means big savings on transaction fees.
"Men are more prone to over-confidence than women so they tend to trade more agressively as a result of that" said Brad Barber, Professor of University of California.
Brad Barber has studied the trading habits of men and women. Among the 35,000 households he surveyed, Barber says over-confidence led men to trade 45% more often while women tended to stay the course.
"Women are more likely to reflect on the information than men are, and are therefore less likely to act on it in a spontaneous way." said Barber.
One thing is for sure, we can all learn from the women surveyed by following 3 simple rules.
First: Trade less often, more trades means lower returns.
Second: "Hot" investments are harmful. Don't react to today's buzz, ignore short-term market movements and only re-balance your diversified portfolio annually, bi-annually, or quarterly.
Third: Keep it simple. As a general rule of thumb, the more complex a portfolio, the lower the return.
Easy strategies that Beth and her fellow investors always follow.
