by ASILA JALIL / pic source: asiaasset.com

FEWER women are trading on the stock market compared to the male counterparts due to their household commitments and lower pay, market experts said.

CGS-CIMB Securities Sdn Bhd CEO Ruzi Rani Ajith said lesser wages mean that women will have to carve out a bigger portion of their paycheque to gain equal returns from their investment which may hinder them from participating in stock trading.

“On average, women make only 80% of a man’s salary, and women need to invest a greater percentage of their paycheque to make similar gains from their investment compared to men.

“Women are also less likely to negotiate for a pay raise and motherhood penalties,” she said at Bursa Malaysia’s “Ring the Bell for #EqualityforEquity” panel discussion held in conjunction with International Women’s Day yesterday.

At the end of last year, women made up 39% of Bursa Malaysia’s retail investors account and contributed 28% of total trade value by retail investments.

BNP Paribas Asset Management Malaysia Sdn Bhd CEO and country head Angelia Chin-Sharpe (picture) said cultural factors, such as household priorities, also contribute to the lack of female participation in stock trading.

She said a large share of working women tend to pass on their income to their partners or channel it to a joint account for household management purposes, which reduces their disposable income for stock investment.

“It is important for women to be empowered in terms of their own financial investment. They should have their own individual savings apart from the contribution to the joint household expenses.

“It is also an important agenda for women to have their own personal savings and grow it,” she said, adding that the absence of financial independence among women leads to the lack of ability to invest.

Chin-Sharpe, however, advised women to start their own saving scheme first before joining the stock market. “Women are advised to build their own financial nest and have a thorough understanding of investment before joining the stock market. They can begin by growing their wealth via unit trust funds first,” she said.

Mastercard Centre for Inclusive Growth VP Alison L Eskesen said woman leaders’ presence in the overall financial landscape could also draw more participation in the stock market.

“The role of mentors and the presence of women leaders in the financial landscape can influence early on in the career path that you want to pursue.

“Having more women leaders to take on prominent roles and men who are advocates for equality can really open up space for participation and for them to pursue professional pursuits,” she said.

Ruzi said while there are many women professionals in the financial industry, many are not present at the top level because women are not “visible” enough, especially those in mid-level positions.

She said women tend to underestimate their own ability and achievement, which stops them from pushing forward and showing what they can bring to the table as female leaders.

The pandemic has also presented opportunities for women to gain access to the stock market, Ruzi said.

“There is a silver lining we have seen during this pandemic and that is innovation and how we have transitioned from working at offices to working from home.

“With the digital revolution, women have more access to the stock market. There are also robo-advisors and online trading platforms that enable women to understand investment better and join the stock market,” she said.

Ruzi said regulators and the government can have a robust committee to look at protection for retail investors’ interests to encourage more women participation in the market, adding they can also reach out to women in the bottom 40% income group via financial freedom campaigns.

Eskesen said there should also be more conversations on long-term strategies for women who are interested in the stock market.

“We should think about mid-term and long-term strategies between balancing what is liquid and illiquid.

“If you have a long-term goal, such as to have a wedding or educating your children or even retiring, you should start thinking of how to get there, and what aspects of investing will get you there,” she said.