By Yoon Ja-young
Women now outnumber men when it comes to investing in large-cap shares as an increasing number of women turn their eyes to stock investment, according to the latest data. Female investors also tend to reap bigger returns than male investors by sticking to long-term investments.
According to Korea Securities Depository data submitted to Rep. Yun Ju-keyng of the governing People Power Party (PPP), female shareholders outnumbered males in nine out of the top 10 stocks in terms of market capitalization. Shinhan Financial Group was the only exception where male investors outnumbered females.
The latest data reflects an overall increase in the number of female investors as well as their preference for large-cap stocks. The number of female investors has been increasing after the market crash triggered by the outbreak of the coronavirus pandemic. They joined a group of retail investors who banked on a stock market recovery and ended up accounting for 47 percent of stock investors last year, which contrasts with 42.6 percent in 2020.
The number of female stock investors in Korea stands at 6.46 million, which is still smaller than males at 7.27 million. But they outnumber males in large-cap stock investments. In the case of Samsung Electronics, for instance, 45 percent of its shareholders were women in 2017, but account for 57 percent as of March. They accounted for 41 percent of Naver’s shareholders in 2017, and the ratio surged to 59 percent. In the case of LG Electronics, 60.7 percent of shareholders are female.
The top 10 most popular stocks among male investors, and are categorized as large-cap stocks, performed better than those popular among female investors so far this year ― those popular among males suffered a 5.2 percent loss, while female investors’ picks sustained a 17.3 percent loss.
However, an analysis of overall investment returns tells a different story, as males tend to make short-term decisions while preferring to bet on volatile stocks. A recent analysis by Hankook Ilbo, the sister paper of The Korea Times, and a securities company on 5.11 million retail investors showed that they sustained a 17.69 percent investment loss as of May. By gender, males suffered an 18.75 percent loss, while females saw a 16.66 percent loss. When combining gender with age, females in their 70s or older sustained only a 9.16 percent loss, while males in their 20s performed the worst, suffering a 21.26 percent loss.
“The poor performance of retail investors has to do with frequent trading. They are overconfident in their capability and tend to regard stock investments as a chance for a jackpot,” said Kim Min-ki, a research fellow at the Korea Capital Market Institute.