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BlackRock Introduces Model Portfolios for Women

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What You Need to Know

  • The portfolios seek to account for differences in life expectancy, pay and employment.
  • Women may be underinvested in equities at key points because of gender differences in these areas, BlackRock says.

BlackRock has introduced its first model portfolios for women in an effort to improve outcomes by accounting for differences in life expectancy and gaps in employment and income.

Women may be under-allocated to equities at critical points in their lives when these three factors aren’t reflected in their investment choices, the firm said in a press release Thursday.

Women, on average, live five years longer than men and earn 82 cents for every dollar that men make, with Black and Latina women earning even less, BlackRock noted. The firm also cited data showing that women leave the workforce for 1.2 years on average to care for children or elderly relatives.

“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,” said Stephanie Epstein, global head of models infrastructure and co-lead for BlackRock’s Women’s Initiative & Allies Network.

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

The model portfolios include different asset mixes for different life stages, seeking more growth for young women, lower volatility around retirement age and consistent income later in life. They can serve as a portfolio’s core, the firm said.

The framework “provides a flexible avenue for customization. Incorporating gender-specific demographics into our lifecycle model resulted in a tailored risk profile to better support women’s spending throughout retirement,” said Chris Chung, CFA, head of retirement solutions portfolio management and co-manager of the model portfolios.