Differential Investment Performance In South Africa Based On Gender

Willows, Gizelle D.; West, Darron

doi:10.19030/iber.v14i1.9040

Cited by 10 publications

(38 citation statements)

References 37 publications

(43 reference statements)

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“…These gender differences are consistent with research performed around the world (Lusardi and Mitchell 2011;FSB 2012;Xu and Zia 2012). Furthermore, Willows and West (2015) reported that women (who are more risk-averse than men [Willows and West 2012]) are less prone to trading. It is suggested that the possible reluctance by women to engage in financial practices is a hindrance to their development of improved financial knowledge.…”

Section: Factors Influencing Financial Knowledgesupporting

confidence: 85%

Actual and Self-Assessed Financial Literacy among Employees of a South African University

Willows¹

2019

Numeracy

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This study examines the level of financial literacy and self-assessed financial literacy amongst members of a South African tertiary institution's retirement fund. Based on surveys of the fund's members, I employ descriptive statistics and multivariate regression analyses to examine differences in financial literacy within and across groups. The results show that, despite working for an employer implementing many best practices identified by financial literacy advocates, respondents from all demographic subgroups possess relatively low levels of financial knowledge. Men, White respondents, and those with a higher cost of employment or higher educational attainment were more likely to have a higher level of financial knowledge. In addition, while most respondents were accurate in their self-assessments of financial literacy, those less accurate self-assessments typically underestimated their abilities. The general accuracy of self-perception implies a self-awareness that can be appropriately exploited to attract lessnumerate individuals to training courses. Overall, the findings suggest we might more efficiently target training to subsets of individuals.

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Section: Factors Influencing Financial Knowledgesupporting

confidence: 85%

Actual and Self-Assessed Financial Literacy among Employees of a South African University

Willows¹

2019

Numeracy

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“…Advisors were shown to assign too much diagnostic value to particular demographic variables when estimating their client's risk tolerance (Roszkowski & Grable 2005). This risk tolerance stereotyping has been found in prior literature relating to gender perceptions, as discussed by Willows and West (2012).…”

Section: Risk Aversionsupporting

confidence: 67%

A comparison of retirement saving using discretionary investment and Regulation 28

Willows

Burgers

West

2018

SAJEMS

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Background: There is growing uncertainty in global society with regard to how retirement savings should be approached. The primary reason for this is that most societies do not save enough and their citizens run out of money during retirement. Aim: This study investigates whether the limitations imposed by Regulation 28 of the Pension Funds Act of South Africa encourage optimal asset allocation and reduce investment risk for retirement savings when contrasted with discretionary investment. Setting: The study looks at hypothetical individuals who are subject to tax and retirement consequences as administered by South African legislation. Methods: A quantitative risk and return analysis was performed while considering two hypothetical investors who are identical in all aspects other than their choice of investments. Results: The findings indicate that Regulation 28 is effective in reducing the investment risk of retirement savings; however, it may also force the investor to sacrifice wealth. Conclusion: Depending on the tax bracket in which the investor sits, discretionary investment may be preferential to investing in a retirement fund under the mandate of Regulation 28.

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“…A more recent study of 19,021 individuals from a South African investment house over the five year period from 1 January 2007 to 31 December 2011 was carried out by (Willows & West, 2015a). The study evaluated the trading behaviour, returns and variances in returns earned by investors.…”

Section: Trading Frequencymentioning

confidence: 99%

Who trades profusely? The characteristics of individual investors who trade frequently

Richards

Willows

2018

Global Finance Journal

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Research has shown that investors trade too frequently and that this overtrading lowers investment return. This paper examines the characteristics of those investors that trade frequently. Using over three years of trading data of 7 200 investors at a brokerage firm in the UK, descriptive statistics and multiple regression analyses were able to identify the predictive characteristics of investors that trade often. Most noteworthy is that trading frequency is positively skewed resulting in a small proportion of investors doing the majority of the trading with the highest cumulative value. These frequent trading investors tend to be male, younger and make use of multiple mediums of trading to trade. These mediums include the internet, the telephone, an advice team and use of stop losses.

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Differential Investment Performance In South Africa Based On Gender

Abstract: Research has shown that, as a result of certain behavioural biases, individuals do not always

Cited by 10 publications

References 37 publications

Actual and Self-Assessed Financial Literacy among Employees of a South African University

Actual and Self-Assessed Financial Literacy among Employees of a South African University

A comparison of retirement saving using discretionary investment and Regulation 28

Who trades profusely? The characteristics of individual investors who trade frequently

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