Watch: Girls that Invest founder on why more women should embrace the stock market | The Crypto Mile
Girls that Invest founder Simran Kaur encourages more women to embrace the stock market now that "the barrier to entry for investing has dropped significantly".
On The Crypto Mile this week, Yahoo Finance spoke to Simran Kaur the founder and host of Girls that Invest, a popular podcast that cuts out the jargon and breaks down the world of investing and growing wealth for Generation Z and millennial investors.
The episode delves into predictions for equity markets in 2023 and gives investment tips for millennials who may only have small amounts of disposable income.
Kaur's podcast aims to make the world of investing less intimidating for women, and has become the world’s number one investing podcast made specifically for women.
Speaking to Yahoo Finance she encouraged female and male investors alike to consider one piece of advice before diving into a stocks, bonds, indexes or crypto assets.
"Something that we say often on the podcast is that if it is not something that you understand, then you don't have to invest in it straight away.
"This is something that Warren Buffet uses, and for a very long time he didn't invest in technology. He missed out on investing in things like Apple (AAPL) and Google (GOOG) when they were quite young, because he didn't understand them, and only when he did, he said okay I'll put my money there", she said.
The podcast host explained how the barrier to entry for investing has been lowered significantly. Investors do not need large sums to begin with, as they can purchase fractional shares, or stock slices.
This is when an investor owns less than one whole share of a company, allowing them to invest in stocks based on a dollar amount.
Kaur said: "Now, thanks to fractional shares you can invest in a company that you are interested in, even with a single dollar. We forget how useful that can be."
She advises a long term investing style, especially for younger investors who have only small amounts of disposable income at hand.
Kaur then explained a potential way for young women to grow their personal wealth using micro-investments, of as little as $5 per week.
"If you invest $5 every single week it will add up over time, and the barrier to entry to investing has dropped significantly", she explained.
For beginners looking to start out in the complex world of global finance, Kaur recommended investing in index funds rather than individual stocks, adding that the biggest difference between investing in index funds and investing in stocks is risk.
She said: "I think if you are a beginner and you don't know where to start, you can look into index funds and you can find these across most investing platforms, whether you are in the UK and you are looking at eToro, or you in the US, and looking at Robinhood.
"Wherever you might be, you can now put a very small amount of money and spread it across hundreds, if not thousands of companies, which is a really good way to get started.
"Index funds seem to be a much easier option for investing especially for young women, whereas with individual equities, you're taking on a much higher risk and putting all your eggs in one basket."
Women and men's differing investment strategies
Kaur believes there are differences in the way men and women invest, employing different types of strategies, to achieve different goals.
She said: "We find that female investors are a little more apprehensive until they find a wider set of knowledge when it comes to investing.
"Investing means, understanding different strategies, such as dollar cost averaging, or what diversification is. So, when women understand the sector they are more likely to jump in. Whereas our male counterparts like to try and learn as they go along, with a trial and error approach."
She added that there are also gender differences in the overall reason for investing, stating that "female investors tend to think of how they can invest to put the profits back into my family or community, they tend to be more community focused".
Growth sectors to watch in 2023
The Girls that Invest founder then talked about what she herself has an eye on for 2023 and beyond.
"I think it comes as no surprise that a lot of people are becoming very interested in artificial intelligence and a growth area is to look at companies that are making use of AI", Kaur explained.
She gave one recent example as media news outlet Buzzfeed's announcement that they will be using AI to generate some of the content they create, which shes pointed out: "caused Buzzfeed's share prices to rise instantly that day".
The podcast host added: "So, it is about trying to find which companies are making use of the technologies that are changing the world."
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Referring to growth sectors for 2021, COO at Outlier Ventures Nathalie Oestmann spoke Yahoo Finance and pointed to a recent KPMG Investor survey that revealed over 90% of investors predict the metaverse is the next phase of the internet.
She added that "this aligns with our beliefs at Outlier Ventures and the volume of accelerator applications we receive and number of startups and investors we speak to each year".
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Oestmann explained a specific area that shows that shows unique potential being the "convergence of technologies, such as AI with Web3, that create increasingly rich ecosystems".
"We are also excited about Zero Knowledge proofs, which we see as having the potential to really bring Web3 adoption into the mainstream through enabling the world of business to leverage blockchains without concerns on cost, scalability or privacy."
In light of Wednesday being International Women's Day, the Outlier Ventures Chief Operating Officer added that a "fundamental focus for us now is ensuring that we see an increase in female founders joining our cohorts, as many of the core values of the Web3 community are focused on dismantling old systems and giving power to communities so we really want to ensure that we help create a diverse community".
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