iFund- Women should be independent, especially economically

2019-03-19 10:02
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In fact, women should not underestimate their ability in investing. Last year, Warwick Business School announced a study that women gained more return than men on investment. Women’s annual returns are 1.94% higher than the FTSE 100 index, while men’s performances are only 0.14% above the index. The difference is due to that women tend to choose conservative approach, are more willing to stop loss and trade less frequently.

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The last sentence of Asia Television, also known as ATV, being broadcasted in 2016 is from Actress Candy Lo, “I think women should be independent at every stage, especially economically.” However, knowledge is not enough. We must apply.

Women give up managing money for themselves?

The latest of UBS Investor Watch explored how women do in financial planning. UBS conducted a survey involving nearly 3,700 women in nine countries and regions, and found that more than 80% of women manage short-term finances (such as daily expenses), but, only 40%has long-term financial planning, such as investment, insurance and retirement. The situation in Hong Kong is particularly acute. 71% of women’s long-term financial decision is leaded by their spouses (see Figure 1), which is significantly higher than in the United States (54%) and the United Kingdom (62%). The main reason behind is the division of family roles and the belief that spouses have better financial knowledge (see Figure 2).

Figure 1: Women Role in long-term investment and financial planning decisions

Image source: UBS Investor Watch

Figure 2: Why Married women step aside in long-term financial decisions

Image source: UBS Investor Watch

Women live longer and longer

However, women need to face a fact, that is, their life expectancy is generally longer than their spouses. According to the Census and Statistics Department’s “Hong Kong Population Projections 2017-2066”, the average life expectancy of women and men in 2016 was 87.3 years and 81.3 years respectively, and in 2066 it will rise to 93.1 and 87.1 years respectively. As the retirement period becomes longer and longer, women must learn to take control of their wealth.

Men are better at investing?

In fact, women should not underestimate their ability in investing. Last year, Warwick Business School announced a study that women gained more return than men on investment. Women’s annual returns are 1.94% higher than the FTSE 100 index, while men’s performances are only 0.14% above the index. The difference is due to that women tend to choose conservative approach, are more willing to stop loss and trade less frequently.

Therefore, it is time for women to start managing their finances and planning their own future.

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