NYMag has a huge profile on women on the trading floor and how they’re different from men.The stereotypes that abound are apparently rooted in men’s and women’s hormone levels.
Anna Dreber, an economics researcher at Harvard, told NYMag about a study that shows women having their periods act more like men in terms of risk-taking behaviour. Put another way, men are like women during that time of the month.
The rest of the time though, women are more cautious.
Nancy Davis, who used to be the head of Goldman’s prop-derivatives trading, explains, “If there’s a position going sour on me, I’m not going to sit and say, ‘I know what’s best.’ It would make me want to raise my hand and get advice from other people. It’s like asking for directions when driving.“
John Coates, a senior research fellow in neuroscience and finance at the University of Cambridge, explains that it has a lot to do with testosterone:
“Testosterone surged in traders who were experiencing winning streaks, leading to a greater sense of confidence and a higher propensity for taking risks.”
If there were more women on Wall Street, he says, “I don’t think you’d see the volatile swings that we’re seeing.”
During the IPO bubble in the late 1990s, he says, male traders “were displaying what we call clinical symptoms of mania. They were delusional, euphoric, overconfident, had racing thoughts, a diminished need for sleep.”
So basically, male traders have more of a tendency to be borderline psychopathic?
Nah, but Wall Street could maybe benefit from more females. The author, Sheelah Kolhatkar, was at Davos last year when women won a victory in an interesting (and admittedly silly) argument: if Lehman Brothers had actually been Lehman Sisters, it would have survived.
Read the full article in NYMag.