I'm not a woman. Sorry.
I know, I just immediately disqualified myself from writing this post, so if you'd like to get back to your CNN or Celebrity Gossip, please do so.
However, I believe I can speak on this topic because I am married to one of the brightest investors alive, and pretty much anything I can claim as "success" I can attribute to her. Although I focus primarily on the "real estate" side of things, I believe this post can apply to investors of any asset class.
The investing world is largely dominated by men, but I think that's a travesty and something that is changing. I believe women can make incredible investors and entrepreneurs, and it's my hope that more women enter this exciting field and can help change investing from the inside out.
Now, let's get a few things out of the way before I get started. Yes, I making some generalizations here. I know not every woman has these six attributes, and I know a lot of men have the same.
This isn't gospel truth, this is just my observations of watching the way my wife handles our real estate investing business and the traits that make her successful.
So with that, let's get to the six traits that make women amazing investors.
1. Women Look Beyond Just the Numbers
When investing in any asset class, it's largely a "number's game." However, as a man, I tend to focus WAY too much on the numbers alone.
Investing is not just a number's game, it's a "people game," with so many different moving parts it's hard to keep track of. However, women seem to be much better at seeing the whole picture and investing with some sort of "sixth sense" that I'll never understand. Call it "intuition" or call it "common sense," either way, women do a much better job of this than the investor men I know.
This is especially evident in the world of landlords when accepting or denying tenants. As a landlord myself, I tend to focus on a few specific numbers (see my article Tenant Screening: The Ultimate Guide for those numbers), where my wife focuses on the whole picture to choose the best tenants.
Time and time again, the tenants she picks end up being our best.
2.) Women Burn Fewer Bridges
The investing world, especially with real estate, is surprisingly small. In the course of our business, we tend to run into the same people over and over -- and oftentimes in business, feelings get hurt when something doesn't work out right.
Most men I know, including myself, tend to want to simply burn bridges after a disappointing deal, but this can adversely affect us in the future.
Women tend to salvage those relationships and use them to their advantage in the future.
3. Women Know How to Use Punishment Correctly
Yes, women know how to keep from burning bridges, but they also know how to punish when necessary.
Men are generally pretty terrible at punishment, but women seem to understand the "corrective purpose" of punishment. In my life as a landlord, there are many times when punishment (such as late fees or a strongly-worded letter) are required to properly train a tenant how to act. The same is true for stock investing or any other asset class. Sometimes, you need to go on the attack.
The women investors I know see the importance of taking corrective action, but do so in an instructional manner (not just with raised voices or emotional anger).
This ability helps woman get what they want in their investments and avoid being stepped on.
4. Women Make Decisions Based Less on Ego
When looking for the best things to invest in, I believe women tend to make their decisions based more on the entire deal than on ego, unlike men (like me) who tend to see a deal as a mountain to be conquered, even if the deal ends up being less-than-admirable.
For example, I recently found a nice four-plex in my area. I like small, multifamily properties, so I quickly jumped at the deal and started doing the numbers -- and they looked good. I was going to buy this property.
However, the property was in a bad neighborhood, as my wife quickly pointed out. It also needed a lot of work, which would make financing difficult. And oh -- they were modular homes that would lose value over time. But I didn't care... I was already mentally invested in the deal, and my ego wanted me to keep going. I was going to make this work because it was a challenge I wanted to conquer.
Luckily, I had my wife there to speak some common sense to me and show me why this property was not a good investment. Without her, I would have continued to blaze forward and probably bought a property I never should have.
The same is true for stocks or mutual funds. A man tends to set his mind on one investment because their friend/co-worker/cab driver/etc. told them about it, and their ego makes it too difficult to see the truth about the investment. Men, please listen to the women in your life: They win here.
5. Women Can Multitask Much Better Than Men
On any given day, my wife can be on the phone with a prospective tenant, sending an email to a contractor, faxing documents for a new deal and preparing a lease for a new tenancy -- all while potty-training our new little puppy and making an incredible dinner.
I can barely tie my own shoes.
My wife juggles 50 projects at one time, when I can barely manage one -- and she manages all 50 better than my mediocre effort at one. I don't know what makes most women so much better at multitasking, but nearly every woman I know can multitask with incredible efficiency and accuracy - something necessary for a busy investor.
6.) Women Tend to Be More Conservative
No, I'm not talking politics -- I'm talking about risk.
Women tend to approach their investing with a much more patient, conservative methodology versus men, who tend to enjoy the risk and excitement that goes with crazy deals.
In this case: women are right.
When investing in anything, slow and steady wins the race, time and time again. Yes, the "big wins" and "overnight success" stories tend to get the most press, but it's the conservative investor who uses intelligent investing over many years who build the greatest wealth in this country.
I believe women will have a growing position in the investing world in the future, and for good reasons. Every person has different strengths and weaknesses, and it's important to recognize them in yourself and those you associate with in business so you can achieve the highest possible returns.
Finally, I'll end with a message to the women and men reading this article:
Women: if you are reading this, please don't be shy to get into this male-dominated world. We need you, desperately.
Men: To maximize your potential as an investor, utilize the women in your life. They bring these six attributes, plus many more, to your investments and provide a balance that can overcome your deficiencies and shortcomings.
Finally, if you've made it this far, can you help build this list by adding any more attributes you feel women have that make them amazing investors? Just add your thoughts in the comments below and let's chat!
Photo Credit: David Kracht