Why beating the stock market is women's work

Why beating the stock market is women's work

Women's burgeoning buying power has helped female-friendly companies to outperform the global market over the last decade, according to research by Goldman Sachs.

As women's participation in the workforce has expanded, a growing number of companies have tailored their products to female customers.

Goldman's Kevin Daly has tracked the performance of what he calls the 'Women 30' - a basket of global firms including Next, Mothercare and L'Oreal - and has shown that they have generated three times the return of the wider stock market.

'Women's income is increasing relative to men's,' he said. 'Stocks whose target market is predominantly female have tended to do better.' He expects that outperformance to continue, describing the rise in female incomes as a long-term trend 'that is likely to be maintained over the next 10 years'.

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Enabling more women to join the workforce - and return to it after having children - boosts economic growth, as well as the profits of clothing firms. Daly suggests that closing the gap between the proportion of men and women who are in work could be one solution to the demographic time-bomb facing rapidly ageing countries such as Italy and Japan. In Japan, where the female employment rate is still relatively low, getting more women into the workforce could boost GDP by up to 16 per cent.

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