Women are more cautious than men when it comes to risk tolerance, savings goals and investing behaviour, according to a study by Montreal-based fintech firm Mylo Financial Technologies Inc.
The firm reports that data collected anonymously from its 30,000 users reveals a significant gender gap in several areas. For instance, Mylo says that women set savings goals that are only about half the size of goals set by men — the average goal for women is $24,842 versus $47,810 for men.
When it comes to investing behaviour, the firm reports that its data on its users’ know-your-client information shows that, “women are half as likely to favour high risk and twice as likely to decide to avoid loss, with 40% of women choosing a strategy that generates additional income.”
Moreover, Mylo reports that 26% of women said they would sell an investment that falls in value, compared with 16% of men. Conversely, just 15% of women said that they would buy more of an investment that has dropped in value, compared to 33% of men.
“These responses suggest that women have a lower risk tolerance and are less likely to take advantage of risky opportunities in the market,” the firm notes in its report.
Women also self-report being less knowledgeable about investing. The firm says that just 8% claim to be knowledgeable or “an expert” on investing, compared with 25% of men; and, half of women said they “don’t know anything” about investing, which is almost double the proportion of men.
“What Mylo’s data makes clear is that Canadian women lack confidence in their investment knowledge and in their ability to achieve financial goals at the same level as men,” said Amelia Young, founder of Upside Consulting Group Inc., in a statement. “I’m excited to work with Mylo to test different ways to communicate with women in order to build their confidence around their ability to save, invest and achieve financial goals.”