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‘Change Agents’: Black and Hispanic Investors Want Their Portfolios to Match Their Values
By Mallika Mitra MONEY RESEARCH COLLECTIVE
It’s important to them that investments support the environment and gender and racial equity.
That’s according to new research from J.P. Morgan Wealth Management. In a survey of more than 2,000 people which conducted in April and May, 70% of Black Americans and 46% of Hispanic Americans said it’s important that their investments are in firms that are owned, started and/or operated by Black, Indigenous and People of Color (BIPOC).
That’s compared to 27% of white and 31% of Asian Americans who said the same. The differences don’t end there: Black and Hispanic respondents in the survey expressed a greater inclination than their white counterparts to invest their money in a way that promotes equity more broadly, too.
They really want to be “change agents for their families, for their communities and potentially even the world at large,” says Jeanne Sun, general manager of inclusive investing at J.P. Morgan Wealth Management.
Environmental, social and governance factors (ESG) investing has grown in popularity in recent years, especially among younger investors. Gen Z, for instance, is a highly racially and ethnically diverse generation whose members have grown up with issues like climate change front and center. Understandably, they want their investments to reflect their values.
The study also found that 72% of both Black and Hispanic respondents said it’s important their investments have a positive environmental impact compared to 55% of white respondents. Meanwhile, 60% of Black Americans and 48% of Hispanic Americans indicated it’s important for their investments to be women-owned, started and/or operated, compared to 30% of white respondents.
Overall, 66% of Black Americans and 54% of Hispanic Americans say they want their investments to promote gender and racial equity and diversity, compared to 35% of white Americans.
More control over choosing stocks and other investments
In addition to a preference for ESG investing, Black and Hispanic Americans said they want to have more control over their portfolios, according to the survey.
The research shows that 59% of Black Americans and 57% of Hispanic Americans want to take an active role in choosing the stocks, bonds or funds that make up their investment portfolio.
That’s compared to 46% of white Americans.
“There are different needs that need to be met and different preferences that people are expressing,” Sun says.
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Mallika Mitra is a reporter at Money covering investing trends and cryptocurrency. Previously, she covered municipal finance at Bloomberg News and personal finance and retail at CNBC. She received her masteru2019s degree from the Craig Newmark Graduate School of Journalism at CUNY and bacheloru2019s degree from Kalamazoo College.