How Can I Get Consistent Returns?

8 behaviors to consider when investing
8 behaviors to consider

Recent studies have shown that female investors enjoy more consistent returns with consistent performance

If you’re a man reading this chances are the title either disturbed you or you are ROTFLOL, rolling on the floor laughing out loud.  Not what you thought about investing did you?  This hurt!

If you’re a female you might have had a hunch that you’re better than your hubsand but couldn’t prove it.  Until now that is.  Please don’t gloat about this.   

Ok, maybe gloat for a minute or so.

In a book authored by Louann Lofton, Warren Buffett Invests Like a Girl and Why You Should Too, she brings forth research indicating that women have enjoyed more consistent returns with consistent performance. The author looked over Mr. Buffett’s investment strategy and he too demonstrated all behaviors listed.

Consistency is what you want.  

Why should you take her word? 

You’re right you shouldn’t but consider that the research she presents was conducted by several teams and all concluded that women are better investors.  Better investors in the sense that they are consistent. 

Eight temperament behaviors that the women from the book exhibited are:

  1. Trade less than men do
    1. Will ignore market conditions and not act on a whim
  2. Less overconfidence
    1. Know what they don’t know and are not afraid to question it
  3. Take less risk
  4. Less optimistic
    1. It pays to be pessismitc and a realists
  5. Value research and consider different view points before investing
  6. Peer presssure does not influence their choices
    1. Men will fall into the peer pressure for fear of rejection
  7. Learn from their mistakes
  8. Less testosterone
    1. Are naturally inclined to take less risk

Women in the studies did not necessarily pick better stocks but they had the fortitude not to trade or sell when the market was tanking. 

The men money took the money and ran.  The goal to any investment is to ignore the noise and hang on to the stocks for the long term.  The author suggests that investments need be long term and Warren Buffett is of the same logic too.   

Let’s be honest with ourselves.  It’s ok to say we don’t know.  The study highlighted women’s honesty in admitting they knew what they don’t know.

As an example, the author mentions Mr. Buffett’s tendency to avoid technology companies.  These are outside his comfort zone and he avoids them.  He wants to understand the business before acting on.

Start to hone in on the eight identified temperament behaviors and your portfolio will thank you.