eToro takes diversity into the portfolio. Studies have shown that a higher proportion of women in managerial positions has a positive effect on a company’s profitability. It also promotes factors such as mentorship, collaboration, employee well-being and diversity and inclusion initiatives.
Female leadership and diversity in leadership have been proven to have benefits. Not only for the corporate culture, but also for the growth and development of the company. In the long run, these factors don’t just translate into a stronger, more resilient company with better processes and fresher thinking. They also ensure better outcomes for investors.
dr Hedva Ber, CEO and Global Chief Operating Officer (COO) at eToro
And yet there is still room for improvement when it comes to diversity. Women occupy only about 30 percent of senior positions in the S&P 500. The proportion is even lower for CEOs. In 2021, just 6 percent of S&P 500 CEOs were women.
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Diversity still room for improvement
Nevertheless, the number of women in management positions and on boards is increasing. eToro created the new FemaleLeadership portfolio to reap the benefits for the companies and sectors involved.
The portfolio consists of 35 US-listed companies from the existing eToro stock universe. Analysts have ranked them according to a number of metrics such as gender diversity, analyst ratings, stock liquidity and market capitalization. To qualify, at least 40 percent of the company’s executives and board of directors must be women.
To identify the best stocks of tomorrow, investors need to assess the processes and culture a company is putting in place today and determine who is ready for tomorrow. Diversity of thinking, skills and experience are the hallmarks of a company that is already ready to evolve, embrace new ideas and creatively respond to future challenges.
All of these qualities are proven to be important for long-term success. Gender equality is just one aspect of diversity. However, it is a crucial area where we still have a lot of progress to make. This progression is not necessarily continuous or obvious. The market can seem overwhelming, especially for people who don’t have the time to review the market. With a pre-packaged, diversified portfolio of companies, we will do the heavy lifting and allow our clients to participate in this progress in an easy and responsible way.
dr Hedva Ber
eToro portfolio as an opportunity
Etoro aligns the initial allocation of the new FemaleLeadership portfolio more towards the consumer and communications sector. A particular focus is on retail and internet companies. The composition includes well-known brands whose leadership teams have made important strides towards gender equality.
These include Disney, GAP, Uber, Paramount Global and Hewlett-Packard. You can find the full breakdown here. The launch of this portfolio is part of eToro’s broader initiative to support women in business, finance and investing.
eToro recently launched InvestWithHer, an online community dedicated to encouraging more women to consider investing.
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