Lessons in investing from ISA millionaires
interactive investor is the UK’s second largest investment platform for private investors.
Last week, we celebrated International Women’s Day, so I thought it was apt to dedicate this week’s column to dispelling some of the myths surrounding the way women invest their money so that we can empower and inspire more women to invest – this ISA season, and beyond.
Our data shows that both men and women are brilliant investors – with very little difference in how they position their portfolios – even for our ISA millionaires*.
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- Why ISAs and pensions make a ‘perfect combination’
- Should I invest for my child’s future with a Junior ISA?
- Should I get an Innovative Finance ISA?
- Who is the Lifetime ISA for?
However, women invest less than men, and this needs urgent attention.
Why does this matter? Because, even if you’re saving, shying away from investing can severely limit your financial potential and stability.
Fundamentally, if fewer women are investing, fewer women are reaching their financial goals and building long-term financial resilience. Fantastic analysis from Boring Money found that 6.8m women invest compared to 9.9m men, and women’s average balances are a lot lower too. The result? A staggering £567bn investment gap.
But false narratives are not very inspiring for aspiring female investors
There is certainly a stubborn gender investment gap, for a plethora of reasons, but from my research, it isn’t because of capability or approach when it comes to how women invest their money.
Historically, prevailing myths cast female retail investors as reluctant investors, who – if they do invest – invest cautiously, or perhaps need more handholding.
These generalisations can be a hindrance if we want to empower more women to invest. After all, our analysis paints quite a different picture. This data is just a snapshot – but as the UK’s second largest platform for private investors, it certainly gives us a rich data set to explore.
If we want to encourage more women to not only save, but to invest, let’s celebrate their wins. Because in practice, we can see that when women are investing, they’re setting standards of excellence in retail portfolio management. If we showcase this, we can show that other women can do this too.
Lessons from our ISA millionaires
Let’s do an ISA millionaire breakdown.
Some 67 per cent of ii’s ISA millionaires* are male, and 33 per cent are female.
Of course, I’d love to see that 33 per cent figure rise over time, but it is still encouraging – especially as ii is the most popular investment platform for ISA millionaires*, with the number of investors holding seven-figure accounts on the platform soaring to a record high of 1,607.
The not-so-secret sauce of all ii’s ISA millionaires is staying invested and being diversified – the latter involves spreading money across different asset classes, sectors and geographies.
It doesn’t sound glamourous, but ultimately, it requires time, patience, and benefiting from the magic of compounding.
We also know that many ii ISA millionaires shift their money into the stock market as soon as possible: 32 per cent of ISA millionaire contributions for the current tax year were made between 6 and 30 April 2024 – just after it began. This is sometimes referred to as being an ‘early bird’ ISA investor.
If we delve into the portfolios, we can see that ii male and female ISA millionaires have a similar portfolio asset allocations.
Although interestingly, female ISA millionaires have more in investment trusts then men (37 per cent versus 34 per cent), and less in direct equities (47 per cent versus 50 per cent for men).
The key difference behaviourally is on active trading. On average, male ISA millionaires make 14 more active trades per year than their female counterparts (34 vs 19.5).
But other than that, you could effectively play ‘spot the difference’ between the gender splits. Both men and women diversify their portfolios to help reduce risk.
We can see that they’re investing in a range of equities, bonds, investment trusts, funds, and ETPs (mainly ETFs) to help smooth returns over time, reducing reliance on any single area of the market.
Portfolio breakdowns of ISA Millionaires on interactive investor
| Instrument | Female ii ISA millionaires portfolio split | Male ii ISA millionaires portfolio split |
| Equity | 47.09 per cent | 50.28 per cent |
| Unit Trust | 11.80 per cent | 11.78 per cent |
| Investment Trust | 36.85 per cent | 33.85 per cent |
| ETP | 3.49 per cent | 3.48 per cent |
| Gilts | 0.43 per cent | 0.40 per cent |
| Bonds | 0.33 per cent | 0.20 per cent |
| Other | 0.02 per cent | 0.02 per cent |
Strong performance all round
And the diversification is paying off. Both our male and female customers have enjoyed strong performance, despite the inevitable twists and turns in markets. So, in terms of ‘time in the market, not timing the market’ – the proof is in the pudding. This is fantastic to see.
Looking more broadly at all of our investors, not just our millionaires, over the five years that ii has collated customer performance data, female customers returned an average of 25.05 per cent, compared to male customers who also enjoyed strong performance, returning 25.03 per cent.
In fact, ii’s female customers tend to slightly outperform. It’s a small difference, but still worth noting, and shows that they more than hold their own performance wise, dispelling the myth that they need more handholding with their investments…
Moving away from generalisations
Although this is just a snapshot, it is indicative of how the assumptions that women are fundamentally more risk averse, or that they need more help in understanding investment are ones we need to move away from.
Tackling the persistent pension gap and investment gap is vital, but the reasons for these gaps are not necessarily due to fundamental differences between men and women.
To bridge the gender investment gap and accelerate action, instead, let’s showcase the successes we are seeing when women do invest.
Let’s show how women are investing effectively for the long-term, and how they’re doing it. And how uncomplicated it can be if you’re in it for the long-term.
This will help inspire and inform others. There is so much power in sharing experiences when it comes to investing.
Anything related to money is still very taboo in the UK, but creating spaces for these open conversations about money is crucial. We must encourage women to speak to their peers, family, and friends about investing. Women sharing their positive experiences with investing will inspire others to start, or to build on theirs. It will inspire young women to start earlier, and it will prove to women in later stages of their life that is never too late to top-up their personal savings, even if they’ve taken time out of work for extended periods of time.
*interactive investor is the most-popular investment platform among ISA millionaires. The number of ISA millionaires on interactive investor, the UK’s second largest DIY investment platform, now stands at 1,607 (as of 28 February 2025) – almost 300 more than the total from our largest competitor Hargreaves Lansdown (1,322 as of December 2024).
There were some 4,850 Britons with a seven-figure ISA portfolio by the end of the financial year in 2022 (latest figure available), according to data obtained following a freedom of information (FOI) request.