The way in which men and women approach investing is inherently different. And at a time when almost all investors are coping with losses, those differences are accentuated. The result: you may need to beef up the time you spend nurturing relationships with your women clients.

Studies show that when it comes to investing, men typically are more confident and risk-tolerant than women. In addition, recent research has shown women tend to worry more than men do about their investments and financial security. According to TD Waterhouse Canada Inc. ’s annual RRSP poll, which surveyed more than 1,000 Canadian investors this past December, 54% of female respondents reported they were frequently kept awake at night by financial worries, compared with 41% of men.

Toronto-based Russell Invest-ments Canada Ltd. ’s financial health index, which gauged the opinions of 800 Canadians late in 2008, revealed similar results. It found that females were about nine percentage points less optimistic about their financial situation than their male counterparts. One area in which women expressed more concern than men did was in “having reliable, trustworthy professional advice.”

Wade Walters, a certified financial planner with W.H. Stuart & Associates in Victoria, has certainly noticed a much more panicked response to the market plunge from female clients than from males. “Females have been more uneasy than males,” he says. Female clients, he adds, have been more likely to consider pulling all their money out of investments. In contrast, men have treated the market decline as an investment reality they’ve experienced before.

“Men have stayed the course,” Walters adds.

This heightened anxiety among women means you may need to spend more time reassuring these clients that their portfolio is in good hands, particularly as this market volatility continues.

“The lower risk tolerance,” says Meir Statman, a professor of finance at Santa Clara University’s Leavey School of Business in California, “means that these kinds of declines, which have decimated portfolios, are likely to elicit a stronger reaction.”

In recent studies that Statman conducted on gender and finance, he found men to be much more confident in their ability to pick winning investments than women were. Therefore, less confident female clients may require some extra persuasion before making investment decisions — and some extra explaining when their investments take a turn for the worse.

“Women,” Statman says, “are probably more likely to rely on experts, such as financial advi-sors, to guide them and calm them down.”

Walters has experienced this first-hand. The more extreme reactions from female clients has forced him to spend more time and resources to keep these clients satisfied. “It does involve a lot more time,” he says, “a lot more conversations, a lot more explanation.”

But advisors who reach out to females clients and spend the necessary time working with them will ultimately benefit from stronger relationships, says Kathleen Wylie, a senior research analyst with Russell Investments: “There’s an opportunity there for advisors. They should be targeting women — to help them through this.”

But opportunities also exist among male clients — particularly as they are more likely to continue investing throughout this turbulent environment. According to Walters, male clients have been adding more money to their accounts in recent months, while females have been waiting on the sidelines.

A February poll conducted by Toronto-based Franklin Templeton Investments Corp. would seem to back this up. The poll found that 28% of male respondents described their RRSP season investment strategy as either “opportunistic” or “risk-taking,” compared with 18% of females.

Among Walters’ clients, females have recently shown more interest in fixed-income products, while males have maintained their risk tolerance toward equities, despite the severe hit their portfolios have taken.

“Men see more opportunity with stocks being down so low,” Walters says. “Women, on the other hand, are looking for more security than their male counterparts [are].”

But those risk-taking males may also be more challenging to work with, Statman cautions, as they cope with investment losses. He has found that men are likely to attribute investment gains to skill, while women tend to consider it a matter of luck. Based on this inherent belief, males could be more likely to blame their advisor for any losses they incur. IE