Abby Johnson & Kathy Murphy: “Let's Prove We Can Do Something New”
Bloomberg Markets|December 2018 / January 2019

IN AN ERA OF LOW-COST index funds, it’s tough to be best known for your stockpickers.

Margaret Collins And Charles Stein
Abby Johnson & Kathy Murphy: “Let's Prove We Can Do Something New”

Fidelity Investments, the 72-year-old family-controlled company, made a splash in August with the industry’s first zero-fee index funds. Abigail Johnson, who succeeded her father as chief executive officer in 2014, gave a rare interview to Bloomberg Markets and brought along Kathleen Murphy, who leads the personal investing unit responsible for the new funds. Fidelity earned a record $5.3 billion in operating income in 2017, but investors continue to pull money from its active equity funds. The company also grappled with sexual misconduct allegations last year. At their Boston headquarters, Johnson and Murphy, who turns 57 and 56 in December and January, respectively, discussed the challenges of their changing industry. “We need to find other ways to get people to give us a try,” Johnson says.

BLOOMBERG MARKETS: One of the biggest investing stories this summer was the launch of the first two zero-fee index funds, by Fidelity. For a lot of people, it was a surprise that it was Fidelity. Why the free funds?

KATHY MURPHY: We wanted to have more people give Fidelity a try by offering these funds, but it wasn’t just the funds. There were three components of that announcement: the zero-fee funds themselves; being the first in the industry to eliminate all [investment] minimums and account fees; then the third thing, which is probably the most influential on the market, is the reduction [in the number of share classes] of all of our index funds. As we’ve grown our index funds, we’ve doubled the assets in our index funds. We’re the No. 2 provider of index funds in the country.

ABBY JOHNSON: I felt strongly about getting rid of the minimums. I just felt like they had outlived their purpose. When you get as big as we are, and we’re trying to reach so many different people, to have a barrier like that just felt wrong.

Esta historia es de la edición December 2018 / January 2019 de Bloomberg Markets.

Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.

Esta historia es de la edición December 2018 / January 2019 de Bloomberg Markets.

Comience su prueba gratuita de Magzter GOLD de 7 días para acceder a miles de historias premium seleccionadas y a más de 9,000 revistas y periódicos.

MÁS HISTORIAS DE BLOOMBERG MARKETSVer todo
See Which Countries Are Falling Behind On Climate Change
Bloomberg Markets

See Which Countries Are Falling Behind On Climate Change

Under the Paris Agreement, 190 countries and the European Union pledged to take steps to hold the global temperature rise to less than 2C (3.6F) from preindustrial levels—and preferably 1.5C.

time-read
4 minutos  |
October - November 2021
Billionaires Vie for the Future of Brazilian Finance
Bloomberg Markets

Billionaires Vie for the Future of Brazilian Finance

An escalating battle between two billionaires is upending the financial community in São Paulo, Latin America’s wealthiest city.

time-read
8 minutos  |
October - November 2021
Ford Foundation's Darren Walker: ‘We Have to Get Uncomfortable'
Bloomberg Markets

Ford Foundation's Darren Walker: ‘We Have to Get Uncomfortable'

DARREN WALKER, 62, disrupted his Wall Street life more than 25 years ago when he left what is now UBS Group AG to volunteer at a school and eventually pursue a career in community development and philanthropy. Since 2013 he’s been at the pinnacle of the philanthropic world as president of the Ford Foundation, created by the family of automaker Henry Ford during the Great Depression to advance human welfare.

time-read
8 minutos  |
October - November 2021
Fueling the Ener Transition
Bloomberg Markets

Fueling the Ener Transition

I MAY BE BIASED, but some of the most important research and data on the Bloomberg terminal lies in one of its lesser-known functions: {BNEF }

time-read
1 min  |
October - November 2021
Dig Into Analysts' Estimates for Disruptive Companies
Bloomberg Markets

Dig Into Analysts' Estimates for Disruptive Companies

THE PANDEMIC ERA generated a whole wave of disruptive companies as it accelerated the introduction of new products and services in areas including artificial intelligence, digitization, electronic payments, online meeting platforms, and virtual currencies.

time-read
4 minutos  |
October - November 2021
Climate Risks Come for Sovereign Credit
Bloomberg Markets

Climate Risks Come for Sovereign Credit

FOR YEARS climate scientists have warned about the ferocious wildfires and hurricanes that are now overwhelming many communities. Today alarms are ringing about a related financial danger: risks lurking within government bonds, the biggest part of the global debt market.

time-read
7 minutos  |
October - November 2021
Responsible-Investing Pioneer Lydenberg Says ESG Needs An Upgrade
Bloomberg Markets

Responsible-Investing Pioneer Lydenberg Says ESG Needs An Upgrade

STEVE LYDENBERG’S passion for social change was inspired by anti-Vietnam War demonstrations, consumer boycotts, and the movement to divest from apartheid South Africa. But he didn’t take to the streets. Instead, Lydenberg turned to the world of finance to help catalyze societal change.

time-read
8 minutos  |
October - November 2021
Engine No. 1's Grancio: ‘People Will Appreciate an Economic Argument'
Bloomberg Markets

Engine No. 1's Grancio: ‘People Will Appreciate an Economic Argument'

ENGINE NO. 1 sent shock waves across corporate America in May when the fledgling investment firm won a boardroom battle with Exxon Mobil Corp., securing three seats on the oil and gas giant’s board after purchasing only about $40 million of its stock.

time-read
6 minutos  |
October - November 2021
Find Out Which Companies May Ramp Up Payouts After Covid
Bloomberg Markets

Find Out Which Companies May Ramp Up Payouts After Covid

AS THE PANDEMIC DISRUPTED business last year, many companies cut or suspended dividends. Which will boost their payouts when economies pick up again?

time-read
2 minutos  |
October - November 2021
Get Into the Minds of Central Bankers as They Navigate Shocks
Bloomberg Markets

Get Into the Minds of Central Bankers as They Navigate Shocks

HAVE YOU EVER WONDERED how central bankers forecast the impact of shocks on the economy?

time-read
4 minutos  |
October - November 2021