The legacy of language in the finance sector

Have you ever thought about the type of language that’s used in the finance sector?

| More on:
language

Have you ever thought about the type of language that’s used in the finance sector? Without having to think too hard it’s easy to come up with a number of some traditionally masculine examples, such as “building” a portfolio, the ASX “fighting” its way upward, watching a share or stock market “tank”, then there’s dawn raids, Death Star IPOs, Samurai bonds, scalping, whipsaws and kill orders, to name a few.

A study published by Tilburg University in the Netherlands in 2015 found that the language and metaphors in investor communication come from the same source domains which include war and combat, heavy physical activity and building and construction.

Now, this is definitely not to say that men like war, or that women don’t like sports and physical activity. Masculine language in finance is a product of legacy. It wasn’t so long ago that women worked only if they were not married. In the past, it was sons, not daughters that inherited a family’s wealth. In fact, if you go back to Jane Austen’s time, the only investment decision made by upper-class women was in choosing a wealthy bachelor to marry. It’s not so strange then that finance, a typically masculine sector, would use some typically masculine language.

The Dutch study also found that this kind of language works to exclude, rather than include women investors. It is a fact that women participate less in the stock market than men, and if they do, they generally take less risk. This gender gap in financial decision-making is often explained due to differences in risk tolerance and financial literacy, but the gap can also increasingly be attributed to the degree to which men and women identify with the language used in the finance sector. While masculine financial language works to exclude women, the study also suggested it creates feelings of familiarity and belonging among men.

Language and the way products are marketed are important drivers of inclusion and exclusion. A good example of this was the changes in marketing tack by both PepsiCo, Inc. (NASDAQ: PEP) and The Coca-Cola Co (NYSE: KO) in the way they marketed their diet soft drink products in the 1990s and 2000s. Marketers found that amongst male consumers, the word “diet” evoked images of the world of women and brought to mind the idea of fitting clothes and spending time in front of a mirror, so Pepsi Max and Coke Zero were born.

Due to increased female labour market participation and changes in socio-demographics, women as much as men are involved in taking care of their finances. So, could there be a time in the future where we knit or weave our portfolios rather than build them? Or perhaps a more gender-neutral financial language will emerge. Only time will tell.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the five best ASX stocks for investors to buy right now. These stocks are trading at near dirt-cheap prices and Scott thinks they could be great buys right now.

*Returns as of January 12th 2022

Motley Fool contributor Bronwyn Bruce has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

More on Share Market News

man at casino throwing chips in the air
Broker Notes

Why the Aristocrat share price is surging again today

The gain comes on top of its 6.7% surge yesterday.

Read more »

A white and black clock face is shown with three hands saying Time to Buy reflecting Wilson Asset Management's two ASX share picks in its WAM Research portfolio
Broker Notes

Brokers name 3 ASX shares to buy today

Brokers are bullish on these ASX shares...

Read more »

Illustration of men and women pushing share price graph up
Share Market News

Why are ASX 200 shares rebounding on Friday?

China's COVID-zero policies have slowed its economic growth and impacted its trading partners.

Read more »

Boy looks quizzical standing in front of a graph.
Share Market News

Here are the 3 most traded ASX 200 shares on Friday

We take a look at the most traded ASX 200 shares by volume today.

Read more »

Red arrow going down on a stock market table which symbolises a falling share price.
Share Fallers

Why Australian Vanadium, John Lyng, Nufarm, and Unibail-Rodamco-Westfield are dropping

These ASX shares are ending the week in the red...

Read more »

A female coal miner wearing a white hardhat and orange high-vis vest holds a lump of coal and smiles as the Whitehaven Coal share price rises today
Share Gainers

Why are ASX coal shares charging higher again today?

The global energy crisis has pushed coal prices to all-time highs.

Read more »

A man leaps from a stack of gold coins to the next, each one higher than the last.
Technology Shares

Why is the Block share price leaping 9% on Friday?

Block shares are storming ahead on a good day for the ASX tech sector.

Read more »

A path through the grass leads to two signs, pointing to profit and loss
Broker Notes

These ASX All Ordinaries shares have the greatest margin risks from surging inflation: UBS

Several ASX shares could be at risk from the threat of higher inflation.

Read more »