Boys will (still) be boys: Gender differences in trading activity are not due to differences in confidence

The fact that men trade more than women in financial markets has been attributed to men’s overconfidence. However, evidence supporting this view is only indirect. We directly test this conjecture experimentally, by measuring confidence using monetary incentives before participants trade in a simulated market. We find that men are more confident and trade more than women, but we do not find that the difference in confidence explains the gender gap in trading activity. We explore alternative candidate channels such as risk aversion, financial literacy or competitiveness but find that these factors are also unlikely to play a role.