I was recently contacted by a writer for Barron’s who  was writing an article on whether or not women make better investment decisions than men.  There have been other articles that indicate women take less risk and are more apt to cut their losses quicker but there is not enough statistical information to make a clear case in this regard.  In fact most all financial advisors whether they are men or women tend to follow the principles of portfolio theory but there are factors that I believe give women an advantage in their role as financial advisors.

1.     Because women focus on building relationships first they can develop trust more quickly; Women have a tendency to  focus first on who the client is rather than what the client wants, in that process they will often  share information about themselves which creates a more personal connection and allows them to develop trust more quickly.

2.     Women’s communication skills enable them to pick up non verbal cues from clients which allows them to make more suitable investment recommendations, this is especially important when dealing with female clients and couples.

3.    Women have natural nurturing tendencies which motivates them to provide service and value in ways that go beyond just their investment recommendations,  this enhances their perceived level of service and value provided by the financial advisor.  This alone can often override performance.

This is not to say that men do not have these skills but given the natural strengths of each gender I believe these are three of the most important characteristics that women bring to the  industry.