Are Women Really Increasing Their Investment Participation?

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JIMMY MOYAHA: Welcome to Personal Finance this Monday. Today, we are exploring an emerging trend that, quite frankly, isn’t surprising – especially after the International Women’s Day celebrations over the weekend. Our focus will be ‘Women in Investing’.

Numerous statistics indicate that women are becoming increasingly interested in investments. If memory serves me right, a study I conducted many years ago suggested that female investors tend to outperform their male counterparts. We’ll dive deeper into that shortly.

Joining me today is Ms. Fikile Mbhokota, the CEO of Satrix, to discuss this topic. Good evening, Fikile. Thank you for being here. Let’s begin with the story in South Africa. Satrix is a local business, and your data shows that 46% of SatrixNOW registrants in 2024 are women. That’s quite an impressive figure.

FIKILE MBHOKOTA: Good evening, Jimmy, and to your listeners. Correct, in South Africa, 46% of our registrants are women, an increase from 37% in 2016, which represents nearly a 10% rise.

Interestingly, South Africa mirrors global trends; a Fidelity study from 2023 found that 60% of women surveyed worldwide are investing in stocks, particularly younger women. This group, including Gen Z and millennials, has seen an increase from 40% nearly two decades ago.

So we see a clear trend: women are beginning to invest, and notably, it’s the younger demographic leading the way.

As the largest index fund manager, this is promising news, as our SatrixNOW platform allows investments starting from just R10.

However, we must also consider the disparity in how much women can invest versus men due to ongoing gender parity issues.

JIMMY MOYAHA: Exactly, Fikile. Even with a growing interest among women, there’s always the conversation regarding if they possess the same level of disposable income for investments.

Moreover, data indicates that women often adopt a different risk approach to investing. As someone who has been involved in investing, I notice that men can sometimes take unwarranted risks, while women tend to be more deliberate in their investment choices. Do your findings reflect this trend, showing that women’s decision-making is comparatively more cautious or at different risk levels?

FIKILE MBHOKOTA: Indeed, research from BrandMapp indicates that women are generally more risk-averse than men, resulting in lower exposure to growth-focused assets in their portfolios.

This discrepancy may stem from the traditional roles within households, where women manage short-term expenses—like groceries and children’s activities—while men typically handle stable obligations such as mortgages and school fees, thus having more capacity to invest long-term.

Nonetheless, I always advocate for women to maintain two funds: one for short-term savings and another dedicated to long-term investments. It’s crucial for women to be courageous and pursue growth, leveraging their inherent cautious nature.

JIMMY MOYAHA: Indeed, the data has shown that women can often be better investors. Fikile, you mentioned earlier that younger women are increasingly making investment decisions and engaging with platforms like Satrix. Can we assert that they’re taking control of their financial futures independently of any forthcoming partnerships?

FIKILE MBHOKOTA: Absolutely. It’s incredibly encouraging. On our SatrixNOW platform, the average age of female registrants has decreased to 33 from 41 just last year.

This shift may indicate significant demographic changes across the country.

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For instance, a study by Eighty20 revealed that there are nearly half a million more women than men holding tertiary degrees in South Africa, along with over 200,000 more women achieving higher education compared to men.

This is a positive development, as it reflects women seizing control of their futures, beginning to invest, and considering their long-term financial well-being.

JIMMY MOYAHA: Fikile, we can’t ignore the gender pay gap. The World Bank estimates that closing this gap could potentially add 2.5 trillion US dollars to Africa’s GDP.

What role do institutions like Satrix play in fostering this positive behavior? We often discuss saving and building that nest egg, as you mentioned, along with making financially responsible choices. How can we encourage the investment culture that seems to be developing?

FIKILE MBHOKOTA: That 2.5 trillion US dollars is nearly ten times our current GDP in dollars—an astonishing figure. Therefore, promoting access and opportunity is essential. The challenge lies in reaching more women.

Financial education is vital; closing the financial literacy gap is crucial, and platforms such as this radio station, which discusses personal finance, are incredibly valuable in motivating women.

Print media is also significant. On our website, www.satrix.co.za, we provide various podcasts aimed at encouraging women.

Additionally, substantial organizations, like the JSE, host pivotal programs, such as the ‘She Invests Event’ annually and offer podcasts on their site.

Educating oneself is crucial; the World Bank reports that over a billion women globally lack access to financial resources.

Bringing it closer to home, millions of women in South Africa are still unbanked, let alone invested. This remains a pressing issue.

On our SatrixNOW platform, when assessing the geographical distribution, most women registered hail from Gauteng (45%). Following that, we have the Western Cape at 18%, KwaZulu-Natal at 13%, North West at 4%, Free State at 3%, and the Northern Province at just 1%. Therefore, promoting financial education is essential.

JIMMY MOYAHA: Absolutely, financial education is the cornerstone, especially as we consider investments and aim to enhance the lives of South Africans.

Let’s conclude our discussion here. Thank you for those insights, Fikile. Fikile Mbhokota, the CEO of Satrix, joined us this week in the personal finance segment, addressing whether more women are indeed investing.

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