Robinhood Looks to Women for Future Growth
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What is the main topic discussed in this episode?
Here's your money briefing for Friday, January 8th. I'm J.R. Whalen for The Wall Street Journal.
How did online trading surge during 2020 and who joined the market?
Online stock trading is more popular than ever. Individual investors opened more than 10 million new brokerage accounts in 2020. But it's still a space that's largely occupied by men. For online trading platforms, one key to continued growth will be targeting a more elusive segment of online traders, women.
There is predicted to be this trillion dollar, several trillion dollar wealth transfer going to be happening in the coming years. And not only in the coming years, right now we're seeing women in general, some women earning more, taking more interest in their investments and their finances.
Coming up, our personal finance reporter, Veronica Dagger, will discuss the challenges that online trading platforms like Robinhood face in signing up women. Plus, we'll talk with Robinhood's head of core products about how it's trying to reach women. That's after the break.
The fast-growing online stock trading platform Robinhood has more than 13 million users. But the company and its rivals see women investors as a catalyst for future growth. In a moment, we'll be joined by Robinhood's head of core product, Deerja Core. But first, our personal finance reporter, Veronica Dagger, is here to discuss the trend. Veronica, thanks for being with us.
Thanks for having me, JR.
So, big picture, what's driven the growth of online trading platforms like Robinhood?
You know, you saw anyone ranging from college students to retirees turn into these stock market traders.
Why are trading platforms targeting women for future growth?
And so that really put Robinhood on the map as one of these really popular apps, especially among younger people. They're getting more popular. Partly it's because, you know, some people have had more time at home. to do things like day trade or just to look into their investments in their accounts. Also, there's a lot more awareness of these apps. You're seeing a lot of the influencers teaming up with apps and that sometimes brings awareness to younger users. Companies are managing trillions of dollars in assets. For example, Fidelity entered the third quarter with some $8.8 trillion in assets under management.
What evidence shows women are becoming bigger players in wealth and investing?
And they have an advantage. They're an incumbent player. They already have name recognition among many individual investors thanks to its 401k platform. And it's been operating for decades longer. And Fidelity said nearly 41% of its nearly 26 million retail brokerage accounts are held by women. So that gives you a sense of the scale some of these companies are playing in.
So why are Robinhood and other trading platforms putting such a heavy focus on enlisting more women as customers?
There is predicted to be this trillion dollar, several trillion dollar wealth transfer going to be happening in the coming years. And not only in the coming years, right now, we're seeing women in general, some women earning more, taking more interest in their investments and their finances. And so traditionally, these types of apps and services and the financial industry in general has been so geared to men and been targeting men for the longest time. Now they're realizing, hey, women They're breadwinners. They are huge wealth holders. Many women actually really care about this stuff. I think there was this assumption that women didn't care, but they do. And there's a huge business opportunity to connect with these customers.
You're missing out on so much if you ignore this population. And so a lot of these companies are saying, hey, these are customers that are really valuable customers. We want to meet them where they're at, and we're going to try to capture them as clients.
All right. To find out how Robinhood in particular is trying to bring on more women customers, we're joined now by Deirdre Kaur, Robinhood's head of Kaur product. Deirdre, thank you for being here.
Thanks so much for having me.
So why do you think it's been a challenge to bring on women as customers, not only at Robinhood, but at other trading platforms?
This is a topic that's very near and dear to my heart.
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Chapters
8 chapters
1
What is the main topic discussed in this episode?
0:05–0:10
2
How did online trading surge during 2020 and who joined the market?
0:10–1:42
3
Why are trading platforms targeting women for future growth?
1:42–2:23
4
What evidence shows women are becoming bigger players in wealth and investing?
2:23–4:50
5
What barriers keep women from investing according to Robinhood’s research?
4:50–6:08
6
How do men and women differ in money conversations and financial confidence?
6:08–8:42
7
What specific product and education strategies is Robinhood using to reach women?
8:42–9:09
8
What measurement and data challenges do platforms face when marketing to women?
9:09–9:13
Speakers
3 identifiedMore from WSJ Your Money Briefing
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