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Source: The National – 

Long renowned for being more prudent with money than men, females are now hands-on about managing their wealth. But to get the best returns they must shake off some of their traditional caution and embrace a little bit of risk.

Women are becoming much more proactive about building and managing their wealth.

Females now control US$39.6 trillion (Dh145.459tn) or about 30 per cent of the world’s wealth – up from the 25 per cent held five years ago, according to research released last year by the Boston Consulting Group.

But behind those figures, many women starting out on their investment journey are unsure how or where to park their money.

Among them is Samantha Greening, a British personal assistant for a manufacturing company.

To help her make the right decision, she attended the recent Investment A-Z: Building Your Personal Wealth seminar organised by international property investors IP Global. It offered delegates advice on key investment areas, such as stocks and property as well as alternative options such as angel investing.

Ms Greening, 50, has lived in Dubai for 25 years, and has two grown-up children in their 20s. “I invested in the past when I was married but my husband was the one driving it more,” she says. “Now I’m divorced, I need to do some other investments for myself but I’m not really knowledgeable on the types of investments available.”

Steve Cronin, the Founder of Wise (, a non-profit community helping expats invest sensibly, says women generally spend more time researching investment options before committing their cash and trade less frequently. But this might be a sensible strategy.

“The world’s most successful investor, Warren Buffett, says he invests ‘like a girl’,” adds Mr Cronin. “Studies show again and again that women outperform men in personal investing over the long term. The flip side of this cautious approach is women often don’t start investing early enough and don’t take enough risk in those earlier years.”

Ms Greening’s main goal is retirement planning. “I’d like to have something set up as a building block to fall back on for retirement and for the kids to eventually have something for them to be able to take away from me,” she says.

One of the speakers at the IP Global seminar was Sonia Gokhale, a founding partner of angel investing platform VentureSouq. She says women must first identify what their money goals are and then work out how to allocate that money towards them. “Do you want to put it towards a down payment for a house, or make it grow for retirement? This changes the risk categories you should use. A down payment, which might take three to five years, is a short-term investment strategy, and for that you should look for something safe. A longer-term investment strategy could be saving for retirement.”

Ms Gokhale says the golden rule is not to put your eggs all in one basket. “Put some of money into property, some in stocks, and some in bonds, and the amount you put in each should vary according to your risk appetite,” she says, adding that short-term investors must look for “liquidity”, ie how easily they can sell the asset. “Bonds and stocks are more liquid than property or angel investment, which takes longer to sell,” Ms Gokhale explains.

Mr Cronin says that because women tend to be less confident in managing their money, they are more likely to seek help from financial advisers.

“Unfortunately the UAE is one of the worst places in the world for financial advice, with most advisers being driven by huge commissions to push you into costly and inflexible long-term savings plans,” he says. “Controlling your finances is too important to leave to somebody else and there is nothing more empowering than knowing you can make it on your own. If you can read a book and understand percentages, then you can invest.”

Money coach Caroline Domanska of Money Mindset Coaching advises her female clients to set themselves parameters. “Ask yourself how much money you would be willing to lose. What would you do if your money fell by this amount? Would you hold it – or sell it? Is it income you want, or growth? Do you need it now or in the future?” she says.

Mr Cronin advocates that investing should be simple, flexible and quick.

“Ideally you check your account once per quarter, transfer some more savings and get on with the many more interesting things in your life,” he says. “So I don’t recommend investing in individual stocks, bonds or even physical gold (beyond jewellery), as then you really need to know what you’re doing and have time to do it.”

Instead he advises a core-satellite approach to investing. “Think of a planet and its various moons,” he says. “Your core should be 80-90 per cent of your investments and be rock solid – stocks, bonds, maybe property. If you want to be a bit more adventurous with satellite investments for the other 10-20 per cent, that’s fine. As a first-time investor, your core should really be 100 per cent.”

Stocks and bonds

As operations director for a Dubai real estate firm, Asal Rakisheva is already a property expert. But Ms Rakisheva, from Kyrgyzstan, would also like to know more about other investment opportunities. “I’d like to be aware of what investment diversification I can offer to my clients, and also for myself personally,” says Ms Rakisheva. “So I’m now thinking about bond options.”

A bond is a loan, and tends to be less risky than stocks, Ms Gokhale explains. “A government bond is the government borrowing money from the people they sell the bonds to. They pay you back coupons, which is essentially just an interest rate, and at the end they pay a principle. It’s a lot safer than other investments, and you know when the payments are coming through because they’re at fixed periods of time.”

With stocks, you are buying part of a company, says Mr Cronin. “Expect an 8 per cent return on average – the value could go up tremendously but it could also fall to zero (which is why you are going to invest in many companies at once).”

Mr Cronin cites numerous studies that show the best way to invest in the markets is:

• A mix of stocks and bonds, based on your willingness to potentially lose money

• Investing passively in the entire stock market rather than trying to pick stocks

• Holding your investments for many years rather than jumping in and out

“Identify how much money you can put away for 10-plus years every month or every quarter,” he says. “The younger you start the better.”

If you are under 45, Mr Cronin says a good mix is 80 per cent stocks and 20 per cent bonds (or keep 20 per cent in cash). Above this you might want to consider 50-60 per cent in stocks.

“Remember many young women are too cautious and miss out on investment gains. Over 20-40 years of investing you have plenty of time to ride out huge crashes like 2008 and reap the benefits,” he says.


Mr Cronin says that more women invest in property than in the stock market as it is more tangible and less volatile. But he warns it is also harder to get out of an investment if you need the money.

“For your first investment choose a country you are familiar with – either the UAE or back home – as you can track good locations, good agents and regulatory changes much more easily,” says Mr Cronin. “Buying a property is a serious commitment, so you must have a stable income to support the mortgage.”

According to an annual YouGov survey of 1,000 UAE residents conducted by IP Global, 33 per cent would rather invest in property in their home country than stocks, shares or bonds (21 per cent).

Natasha D’Souza, a 35 year-old Canadian journalist, bought a villa in Dubailand seven years ago. “It was a case of good timing, having the risk appetite to buy when the market was at its lowest [2010] and seeing the property value appreciate with time,” she says. Ms D’Souza says she chose a project offering future growth potential, because she knew the theme park IMG World was going to be built nearby.

“More than anything, the responsibility that goes with having to pay regular mortgage instalments gave me the sense that I was building equity, building my net worth,” she says, “and that gives you a different kind of conviction.”

One way to secure property at a lower price is to buy off plan. According to Lukman Hajje, the chief commercial officer of propertyfinder Group, developers usually offer between 10 and 30 per cent lower prices for off-plan and under-construction properties. Dubai experienced a 45 per cent increase in the number of transactions for off-plan properties in Q1 of this year, according to Chestertons Estate Agents.

But Cynthia Trench, a Dubai-based lawyer with her company Trench & Associates, says off plan is risky in the UAE, “as the building process might not happen quickly”.

Instead she recommends women buy UAE property from established companies such as Emaar Properties. But check the service charges before signing up, she adds: “For an apartment in the Burj downtown area, you might have to pay Dh5,000 a month in service charges. Arabian Ranches is Dh10,000 a year, for a 3,500 square foot property – just notice the difference.”

Angel Investing

If you find yourself with a large sum of money, women can also consider making a satellite investment in start-up businesses.

An angel investor comes along early on in the life cycle of a company, and helps to fund its growth, says Ms Gokhale, whose business VentureSouk funds early stage tech companies. “You talk to the founders so you get to see their passion and be a part of their story.”

The space has historically been a man’s domain; only 7 per cent of decision-makers at US-based venture capital firms are female, up slightly from 5.7 per cent last year, according to research released last month by Axios.

But in Dubai, a small, growing network of female angel investors is making its mark through Womena, a platform where they can invest in regional start-ups. Co-founder Christina Andreaasen says that women make great investors because they “tend to be detailed, precise and methodical when analysing deals, and can have a great deal of insight, especially into products that target women or families”.

But Ms Andreaasen says some may need to get used to the high risk, high reward model associated with early stage investing. “Women that come from non-financial backgrounds may need some time to become comfortable with the terms, processes and documents used to assess deals and invest,” she says.

Mr Cronin says while this investment strategy is high risk as most new businesses fail, it can be satisfying and offers a very practical business education. “ supports female investors with a minimum investment of US$10,000 per year. They don’t recommend investing more than 10-15 per cent of your net worth in angel investing,” he adds.