Finances are always going to be a major concern for women investors, but the more you invest, the less you should be worried about them, according to a new report from investment firm Zacks.
In a blog post, the firm said that the gender gap in wealth is widening and is expected to be even wider in 2030.
In addition to being a significant financial burden on women, investing in equals a significant risk for women who have lower earnings.
Zacks’ research found that while women make up 15% of the population, they account for 20% of all equities lost in the stock market.
The firm said it also looked at the impact of gender on women’s equity portfolios.
For instance, while women invest less than their male counterparts in equity mutual funds, women have invested more than their female counterparts in cash, index funds and other investments.
“While women are more likely to have lower incomes, this is not reflected in their investment returns, with women still holding over half of their equities,” Zacks said.
“The same is true for women in the workforce.
While they have lower levels of education, they also have higher levels of equity ownership.
Women are also more likely than men to have a lower net worth than men, as well as lower equity portfolios, Zacks found.
While Zacks did not specifically name which equities are the most likely to fall victim to the gender pay gap, it noted that the gap was largest in technology stocks, which are more heavily traded than other sectors.”
Women are disproportionately represented in the technology sector, particularly in the internet and mobile sectors,” Zack said.”
It may be that in these sectors, women are at a disadvantage because of their lower equity ownership and less access to capital in the financial markets.
Zacks also found that women were more likely as investors to invest their money in “high-cost” stocks.”
For instance women may choose not to take any equity risk and instead use their equity funds to save for retirement.”
Zacks also found that women were more likely as investors to invest their money in “high-cost” stocks.
For example, women were significantly more likely overall to invest money in companies that have earnings over $10 million, and more likely when they had to make an investment on a monthly basis, and less likely when their fund was to receive less than 1% of its total assets as return.
Zacks said the gender-based pay gap in the equity market is also not confined to the tech sector, with equity mutual funds being more likely for women.
The firm also said that while most women invest in stocks that have an average annual return of less than 2%, women were less likely to invest a large amount in companies with annual returns above 4%.
“These gender-biased investment decisions are likely to persist even as the gender wage gap in tech companies continues to widen,” the firm wrote.
“In the financial services sector, this could lead to a gender pay penalty as women who make less than men continue to be more likely not to invest.”
For more on the gender divide in wealth, read our special report on the gap in financial investments.