Why women are investing in the stock market at extraordinary rates

November 22, 2021, 5:56 PM UTC

Women may have left the workforce in droves to take care of their children when schools closed in 2020, but they sure didn’t vacate the stock market.

While their 401(k) contributions dwindled in some cases, women entered the equity markets at sky-high rates. Nearly 67% of women are investing outside of retirement accounts now, according to Fidelity’s 2021 Women and Investing Study—that’s up from 44% in 2018. Half of the 1,200 women surveyed said they’re more interested in the markets now than they were at the beginning of the pandemic. And those trends are playing out within Fidelity’s own customer base: There was a 43% increase in accounts opened by women in the three months ending in Sept. of this year compared to the same period in 2020, according to company data.

There are a few contributing factors here: For one, the pandemic led to a big increase in female investors. And bizarre market events like the GameStop phenomenon drew a huge number of new people to the stock market, many of whom were women.

“Events of the past year and a half have proven to be a powerful catalyst for even more women to make their finances a priority,” Lorna Kapusta, head of women investors and customer engagement at Fidelity, said in an email to Fortune.

Brokerages also reported a spike in women clientele last year: Robinhood said the number of women using its platform had tripled. And it’s not just women who are taking a look at the market. The brokerage industry’s regulator, the Financial Industry Regulatory Authority (FINRA), reported a surge in new retail investor account openings, in what has become the youngest, lowest-earning, and most diverse investor demographic to-date.

Brokerages also seem to be putting more focus on attracting women as new clients. There’s a clear business case for that: Women now hold about a third of the financial household assets in the U.S., according to McKinsey research, and that number is set to triple by 2030. One startup brokerage has placed all its attention on women. Ellevest, a robo advisor which automatically invests individuals’ money based on their risk tolerance, revolves its platform around the needs of women in particular, saying that women make less and live longer than men, and therefore have different investing needs. 

Whatever the reason for women’s heightened interest in the U.S. markets, many female investors say they aren’t very comfortable moving their money around within the markets yet, according to Fidelity. Only 33% of women say they are confident in their ability to make investing decisions—and only 14% say they know a lot about saving and investing.

“We continue to hear that women want to learn,” Kapusta said. “We’re seeing a notable increase in women wanting to learn more about investing, selecting investments and managing a portfolio.”

Either way, women are still giving it a go.

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