Female Inside Traders Profit Less Than Males

Martha Stewart may be the most famous woman to have had a disappointing experience as an inside trader, but apparently she's hardly the only one. In a new study of 700,000 insider trades over 20 years, finance professors at the University of Michigan found that female executives and board members who buy or sell their companies' shares based on nonpublic information get less than half the benefit that men in similar positions gain when they risk insider trades.

In the first two months following an insider purchase of their own company's shares, men typically enjoyed a 19 percent gain in the shares' value while their female counterparts got just a 9 percent bump. Viewed in dollar terms, the gap looks even worse. Women average only an $80,000 gain per trade while the guys rake in an average of $350,000. Despite these stats, though, the researchers found that women were just as likely to engage in insider trading as men.

So why the big difference in results? As "Wall Street's" fictional über-trader Gordon Gekko put it so succinctly, "It's information, buddy boy." It seems that the old boys' networks in most companies still keep the most profitable bits of information safe within their clubhouse.