The author is the bond portfolio manager of Barksdale Investment Management and the co-author of “Undiversified: The Big Gender Short in Investment Management”
“What is a day trader?” My godson called to ask me this question just after his 18th birthday. He just had a Schwab brokerage account filled with high school cash.
When I defined the term, he admitted to me, yes, he became a day trader and made a book profit of $1,000 in the first week of his adulthood.I say “admit” because he did something I advise against: read Reddit forums carefully and gamble on stocks that dominate them, such as retailers Game stop.
If he makes a wrong bet, my godson will not go to the slums. I suspect that most day traders are. I believe he has learned a lot from his experience.
But as someone who makes a living by managing investments, I worry about the broader impact of the day trading hype surrounding so-called meme stocks.
It perpetuates many myths about very different “real jobs” in investment management, which in turn makes the industry lack gender diversity for a long time.The suffocating reports of meme stocks indicate that investing is the right of high testosterone, risky, and vacillating “brothers” who yelled and interacted with Wealthy hedge fund managerThis shows that successful investors rely mainly on intuition rather than analysis.
Of course, the actual situation is quite different. As a portfolio manager, I can personally attest to the fact that most of us, men and women, are by and large analytical, dull, nerdy people, and they won’t do without in-depth study of the company. Consider buying stocks or bonds. Otherwise it would be reckless, let alone breach of fiduciary duty to customers.
Meme stock traders’ concentrated bets on very few stocks violate Investing 101’s diversification principles. The intraday trading method requires a great risk appetite and accepts unpredictable daily fluctuations in your life savings.
Research shows that women usually Have a different view of risk From there. This is not to say that they are unacceptable-it’s just that they tend to have a more balanced view of risk and reward.
I am worried that a young woman reading the meme stock report may conclude that she is not the opponent of the hype trader and/or that she has no interest in working in an industry dominated by this personality type.
A large number of women have been prevented from entering the field of fund management. The gender imbalance in the industry is serious.
Give a few figures, as long as 10% Of U.S. portfolio managers (or those who invest your money if you own a mutual fund or ETF) are women, according to Morningstar Research Report. And only 16% of financial advisors (The person who recommended mutual funds and ETFs to you) is a female.
Investment management interviews usually focus on actual investment experience, which is a disturbing way to screen candidates. In addition to a clear baseline of investable wealth required, and excluding those who grew up in ordinary households, how do you verify this prerequisite?
Suppose a woman has participated in an MBA course. This is the traditional way to enter the career path of investment managers. Her interest in investment work may be aroused. However, she may be derailed by the recruitment process that almost always asks candidates about their investment experience. She may be interviewed with an enthusiastic young man who tells the story of his “ten bags”-an investment that has increased in value by 10 times-loved by the movie chain AMC Entertainment and other memetic crowds stock.
Then the hype about what it takes to become a day trader reappeared.A well-known Harvard Business Review Research It is recommended that women can only apply for a job if they are 100% qualified, while 60% for men. This may indicate that jobs that tout “killer instinct” as a qualification will inevitably attract fewer women.
In portfolio managers and investment analyst teams, more attention needs to be paid to huge gender and racial inequalities, rather than launching countless meme stocks. In general, such memetic reports may prevent women and people of color from joining the investment industry, thereby exacerbating these inequalities.
The recent call from my godson is about another update on his book profit (now up 45%, or $4,500). He is with one of his classmates, he is also a self-styled day trader. On a whim, I asked them if they knew any female day traders. They answered: “Well, no.”
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