BlackRock launches model portfolios to improve women's investment outcomes

Asset-management giant identifies three specific female factors not considered by most long-term investing solutions

BlackRock launches model portfolios to improve women's investment outcomes

The world’s largest asset manager has doubled down on its commitment to ESG with a new product line that directly addresses the financial struggles of women.

BlackRock has announced its first Model Portfolios for Women, utilizing the company's exclusive LifePath lifecycle investing framework and modifying conventional investment considerations to incorporate three extra inputs:

  • Life expectancy: In the United States, women often outlive men by more than five years.
  • Income gap: In the United States, women typically earn US$0.82 for every US$1 earned by men, with the gap being greater for Black and Latina women.
  • Employment gap: Women take 1.2 years off the job on average to take care of young children or aging relatives.

BlackRock has discovered that, on average, women may under-allocate to stocks at crucial points during their lengthy investment horizon.

Stephanie Epstein, co-chair of BlackRock's Women's Initiative & Allies Network and global head of model’s infrastructure (WIN), said, “This investment strategy is one way in which BlackRock looks to help women achieve better long-term financial outcomes while we - as a society - continue to work toward closing the gender pay gap and finding more equitable solutions for caregiving.”

As the foundation of a woman's investment portfolio, BlackRock's Model Portfolios for Women include investment mixes for women across several life stages.

“The financial challenges women face are not new. Now, advisors have a bespoke, actively managed, and low-cost solution to help women clients achieve their financial goals,” said Carrie Schroen, Divisional Director at BlackRock’s U.S. Wealth Advisory group. “This is especially relevant as women hold an increasingly larger share of global wealth,” she added.

In launching of the new portfolios, BlackRock is following through on its commitment to advancing gender equity. It follows a May memorandum of understanding that it signed with UN Women, the United Nations entity devoted to women’s empowerment and gender equality, under which BlackRock pledged to help promote the growth of gender lens investing.