Gender has a “far reaching” impact on investment decisions and financial planning, a new white paper from Barclays Wealth shows.

Crucially, females are far less risk tolerant than men, with just 31
per cent of women prepared to take more risks for higher investment
gains, compared to 49 per cent of men, according to the research.

The survey encompassed 2,000 high net worth women with over $1.6 million in investable assets from 20 countries across
Europe, North America, South America, the Middle East and Asia-Pacific.

Female investors in the survey were more likely to admit they felt
stressed, and say they had “low composure” than their male counterparts
(39 per cent versus 29 per cent). This may arise from having a greater
desire for self-discipline and control over their finances (45 per cent
versus 39 per cent), said Barclays Wealth.

“Biologically, several studies have linked financial risk taking to
testosterone. Cognitively, men are more likely to be confident, though
not more accurate, in their financial decisions, and sociologically,
women tend to value wealth as a source of security, not opportunity,”
said Dr Emily Haisley, a behavioral finance expert at Barclays Wealth.

On inheritance planning, women were less likely to have a will in
place, with over 30 per cent of women lacking a succession plan compared
to 20 per cent of men.

However, Dr Haisley cautioned against using research findings as a
basis for stereotyping men and women. She is wise to do so: other recent
research, released in the US by the Family Wealth Advisors Council,
found that one of the areas firms fell down on with their female clients
was not listening to their unique needs.

As women live longer, and are attaining more in professional and
business spheres nowadays than ever before, their share of the world’s
wealth is growing. To put this into context, the World Bank predicts
that women will control a GDP that is bigger than that of India and
China combined by 2014, the report notes. Unsurprisingly, they are also
becoming more engaged with their personal finances.

“As the rate of women’s wealth rises exponentially across the world,
it is becoming increasingly vital that financial institutions and wealth
managers address and understand these differences in order to cater for
female clients more effectively, based on personality and lifestyle, as
well as gender,” said Barbara-Ann King, head of the female client group
at Barclays Wealth.

As well as establishing a female client group, Barclays Wealth last
year initiated a program to address advisor training and create
appropriate products and services, in light of a growing female
potential client base. As part of this offering, the wealth manager has
launched a magazine targeting women who want to know more about their
finances, an example of which can be viewed here.