Diversify your portfolio: Invest in Women

Today is International Women’s Day. It is a day of celebration; however when it comes to finances, many women don’t have a lot to celebrate. But there is some good news…And we’ll get to that.

But first, the bad news…

In America right now, older women are 80% more likely to be impoverished than men. Unmarried women also have significantly less in retirement savings (almost 30% less) than men. And according to the census bureau, women earned 78.3 cents for every dollar men earned in 2013.

But the good news…

Women have a great deal of financial power. They own 8.3 million businesses that generate $1.3 trillion in revenue. As consumers, they make 85% of consumer purchases and influence as much as 95% of all spending. They are a fundamentally important engine of economic growth.

And it doesn’t end there. Women are also better financial decision makers. According to some great research by Fidelity, Women are better financial planners and are less likely to regret financial decisions than men. And they also save a greater portion of their income than men do. They also take on less risk, balance portfolios better than men do. Essentially, as the book “Warren Buffett Invests Like a Girl: And Why You Should, Too” by LouAnn Lofton argues, women have the temperament to be terrific long-term investors.

And this difference does not only apply to investing. Businesses that are run or managed by women also do very well. Companies with more women on their boards perform significantly better than those with few women. 66% better when you look at return on invested capital. Bam!

Today, State Street is launching a gender diversity ETF. It is the SPDR® SSGA Gender Diversity Index ETF (Ticker: $SHE). This SHE ETF is a way to buy into 144 of the stocks with the highest proportion of women board members and senior managers. In this one financial instrument, you can take advantage of the opportunity that may exist with women led companies. We’ll be watching to this fund to see how it performs!

On International Women’s Day, we hope to expand your investment universe and look at your investments a little differently. At GoldBean we are celebrating by launching a new carousel on our explore page that highlights women-led companies. So come to GoldBean and see a whole new way to ‘diversify’ your portfolio.

Team GoldBean

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