We’ve heard a lot about whether women are more cautious than men when it comes to investing, but now there’s a scientific study that addresses it. Elizabeth Sheedy, a financial risk expert from Macquarie University, looked at stock portfolios to see if there was a difference between men and women in terms of investment strategy and performance — and her findings shed doubt on the “Lehman Sisters Hypothesis”: While women as a whole are more risk-averse, those who make it to management positions have the potential to be just as risk-tolerant as their male counterparts. Click through to read the full report from The Conversation, which also details some of the study’s methods and acknowledges the diversity among women.
biznews.com – There’s a popular theory called the “Lehman Sisters Hypothesis” that says well known bank failures (like the Lehman Brothers collapse) wouldn’t have happened if there were more female staff in management. Our research suggests that increasing female staff is, on its own, unlikely to change the way risk is managed in banks.
The Lehman Sisters Hypothesis relies on the research-proven fact that women are, on average, more risk averse than men. It implies that bringing more women into banks will lead to better risk management and reduce the possibility of bank failure or scandal.
While female staff may be more risk averse on average, our research shows many of them are just as risk tolerant as their male counterparts. These are the women who tend to make it to the management roles where risk management decisions are made.
It’s important to note that women already comprise more than half the workforce in the banks we analysed, but they are under-represented at senior levels and in institutional banking. This is the arm of banking that offers complex financial advice and services to large institutions.