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We Are Not As Divided As Our Politics Suggest

by Mike Ma

Last week in Ignites, Steven submitted a piece that explained why he supported Obama, and Jon Fossel wrote about why he supported McCain. Both pieces made good arguments as to policy/tactical pros and cons for our industry ranging from product development to taxation.

However, as I head to the polls in about a half an hour, I am writing today to submit to you that we, as an industry, are not as divided as our politics suggest - at least philosophically speaking. As Lee Gremillion correctly points out in A Purely American Invention, the open-end mutual fund is the way that most Americans procure financial advice.

I'd challenge all of us to use today to look at where we stand today with regard to that principle. I'd submit that if we think about this hard, that we will all be better off in the end regardless of our politics.

I was reminded of this as I recently returned from NICSA's Technology Summit, where last year I had the pleasure of moderating a panel on the Shareholder of the Future. My own personal takeaways from the panel were the following, and I think that these perhaps hold true more today than before:

1. We can look to increase the household penetration of mutual funds. Brian Reid, Chief Economist at the ICI, shared the following three slides (whole presentation available here). As you can see from the chart below, the data suggest that we may be approaching saturation toward the right hand of the wealth curve.

2. We need to get younger investors to contribute to save for retirement. The people who could, but don't participate tend to be the younger ones.

Furthermore, at this year's Tech Summit, Ilkay Can, Director of Acquisition at Schwab, noted that Gen X and Y investors are twice (that's 2x!) as profitable as typical investors since they are "stickier."

3. We need to prepare our businesses to succeed overseas. Vijay Advani of Franklin Templeton shared this slide with the audience showing where sales were coming for Franklin, and the international business has since eclipsed the domestic.

These are large, pressing issues that require a longer reach than an extended finger point at an opposing political candidate.

These are real issues that need our attention regardless of our politics.

If we can look inward at our own organizations to better serve the shareholder (that is, all of them) I think we may be able to really restore the luster to that purely American invention, regardless seeing it through a blue or red lens.