Financial advisers should look to gain a better understanding of differences in attitudes towards investing between genders to engage with more female clients, who are creating and holding greater proportions of UK wealth, according to M&G.

M&G’s The Untapped Potential of Women’s Wealth Report found that women were more concerned about losing money than men, with 61 per cent fearing a financial crash compared to 46 per cent of men.

Furthermore, 68 per cent of women were worried about market volatility compared to 54 per cent of men.

The report noted that these concerns peak at around the age of 35 for women, which it said was an age that typically sees investors starting to seek financial advice.

M&G stated that financial advice played a critical role in giving investors confidence in taking higher levels of risk.

When asked where they invested their finances over the past five years, 35 per cent of non-advised women cited cash, followed by equities (28 per cent).

However, for advised women, the most popular asset was equities at 49 per cent, while more men, both advised and non-advised, cited equities as the most popular asset class.

M&G’s research highlighted that differences towards investing suggested that women may favour investments that reduce the impact of volatility, with women (67 per cent) more likely than men (62 per cent) to invest in smoothed funds.

This rises to 82 per cent for advised women and 79 per cent for advised men, emphasising the role advisers play in explaining the benefits of smoothed funds.

The report argued that a greater understanding of differences in attitudes towards investing can present new opportunities to engage with more female clients, and advisers should consider clients’ concerns around loss and volatility in discussions about appetite for risk and how these can be addressed.

Advisers were also urged to discuss the whole investing journey, as well as the outcome, to provide ongoing peace of mind, and how smoothed multi-asset investment solutions can provide attractive outcomes while reducing volatility and the size of drawdowns.

"Our research reveals fascinating insights into investing behaviours,” commented M&G director of PruFund proposition, Kirsty Wright.

“Initially, some women may question the benefits that advice can bring and want to better understand the need to include risk assets in their portfolios. However, once they’ve developed their understanding, they become successful, long-term, composed and risk-focused investors.

“Tailoring the investment experience to respond to a wider range of perspectives and greater concerns around volatility and losses can present new opportunities for advisers to engage with clients.

“While it may not change the long-term outcome that advisers work to achieve, it could have consequences for the investing experience that a wider client base of investors want to have in reaching their goals.

“Addressing market volatility concerns is essential to ensuring customers feel confident in achieving their financial goals. Recent market turbulence, as a result of US trade policy, demonstrates this more than ever and signals how the wealth industry can continue to evolve its approach."

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