Women in Trading: Why They Rarely Do It and Why They Are Better At It

It is no mystery that trading remains one of the few ways of making a living in which men predominate in an almost total fashion. Encountering a female trader is in fact quite rare and most traders have in fact never traded with or even talked to a trader of the opposite sex. A few years ago this triggered my curiosity and prompted me to look for women traders who had the same way of making a living as myself. What I found was very surprising, showing me how the thought process between male and female traders is very different and giving me a huge hint of why women tend to be much more successful in trading than men. During this post I will share with you some of the things I have learned from female traders and their way of engaging the market and why their success rate seems to be much higher than that of men.

When I set myself to find traders who weren’t men it wasn’t an easy task. I had to contact almost all the traders I know and I had to do a lot of networking before I could find at least a few women who were making a living out of trading the market. Even then, only one of them was an algorithmic trader (the rest were discretionary traders) and this left me with a very small sample to evaluate. However upon talking to a few of them it became clear that they hold several advantages over men which make them much more successful at trading in general.

The first thing that makes women more successful is actually something quite curious which spans from the fact that they don’t have the “alpha male complex”. One of the women I talked to told me that one of the main problems she saw in men was that trading for men was mostly about being better than other men (an alpha male competition) and this led men to take unnecessary risks and to feel extremely bad when they didn’t make extraordinary gains. Women, on the other hand, tend to lack this urge to compete, focusing much more on whether or not they are doing things right rather than on whether or not they are doing things better than someone else.

Another important thing I noted was that women in general tend to much more risk averse than men. In general – from the women I talked to – I couldn’t find any of them who used trading techniques as aggressive as those used by some of the discretionary traders I know. Certainly women tend to risk less and to take higher probability setups, meaning that they are much more careful with their money and less likely to have more account wipouts than men on their learning process.

Another very interesting difference arises when you consider the way in which our female counterparts evaluate the market and decide whether or not to take trades. Although the tools are generally the same, women tend to have a much easier grasp at interconnecting several different aspects of the market. Since their brain seems to be better overall at forming connections between different matters, it quickly became clear to me that women are better at watching the “whole picture” while men tend to get stuck in small details which do not allow them to see what is happening overall. One of the most surprising things I remember seeing was a female trader who showed me a position analysis that used more than 20 different instruments and the way they were trading. Without a doubt the ability to make connections between different events seems to be far more developed than how it is in men.

Many men would also think that women have a harder time dealing with the emotional side of trading (since they are generally thought to be much more emotional) but the truth is that this is far from the case and in most cases women are more emotional but much MORE emotionally intelligent than men. Since women are in general more in touch with the way in which they feel about things they tend to handle their emotions better and make less stupid mistakes based on the way in which a trade or a trading result makes them feel.

Now you may wonder why women tend to avoid becoming traders (it is very rare to see them on this field) and the answer seems to lie on the fact that women tend to choose to do things which have more meaning besides the intent to make money. As a matter of fact – from the limiting experience I had with women trading – those who do tend to have very money-oriented personalities and a very strong idea of being better than men at this. That said, it seems that women who become traders have a set of very specific goals and mindset which are not very common amongst them in general. Of course it is true that this may change as the success of women in trading becomes more well known and it would definitely be great if women became a much larger part of the overall trading community.

So although the above advantages against men do not apply to all women (nor the problems to all men)  it is clear to me from the contact I have had with women traders that they hold the upper hand when talking about succeeding in trading. Their lack of an “alpha male complex”, their higher emotional intelligence and their ability to see and connect things beyond what men can do in most cases is what makes women such good candidates for becoming excellent traders.

If you would like to learn more about my work in trading and how you too can design your own likely  long term profitable strategies based on sound trading tactics please consider joining Asirikuy.com, a website filled with educational videos, trading systems, development and a sound, honest and transparent approach towards automated trading in general . I hope you enjoyed this article ! :o)

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3 Responses to “Women in Trading: Why They Rarely Do It and Why They Are Better At It”

  1. The Young one says:

    Thanks for the article, I really enjoyed reading it.

    I am studying behavioral economics at the moment and recently came across some empirical evidence that women in professional environments tend to be taking as much risks as men, but only in professional environments that require them to do so. Since reading your article I was wondering if you think there could be an explanation for these empirical evidence.
    You touch on this subject a little in your article, but I was wondering if you think that women traders self-select in risk taking environments or if learning makes them more prone to be taking more risks than women otherwise will be taking?

    Thanks,

    • admin says:

      Hello,

      Thank you for your comment :o) I am glad you enjoyed the article! It is actually difficult to answer whether women are taking higher risks because they “learn it” or because it is natural in them to do so. From what I have seen women in environments where men are taking risk and being rewarded for it will also take risks in order to “not fall behind” while when working alone women will tend to me much more conservative. Talking to the few women traders I know I could see that those who learned on their own are much more conservative that those who knew out of a formal background (institutional trading) and had to “team up” and compete with men who were taking more risks. Obviously I lack the necessary statistics to say anything conclusive but my opinion is that women are taking more risks if the environment demands higher risk taking (just like man do) but when evaluated individually women tend to be much more conservative. I hope all of this makes sense :o) Thanks again for your comment,

      Best Regards,

      Daniel

  2. I enjoyed reading about us! Yes, I’m a woman trader, I call myself a Trader Mom in fact. Anyway much talk about why we take “less risk” — my way of thinking, we have kids, household expenses, that shoe we want to buy, we could have been shopping with the money we lose! I share my trading experience as woman – to teach my girlfriends about Trading, many women want to do it, I can tell you that!

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