For the majority of American history, women were shut out of investing. In the 18th century, it was assumed that a father or husband or brother would handle all of a woman’s financial decisions, and most women could not even own property, let alone invest. While married white women’s property rights were expanded in the 19th century, even the most privileged of women had to fight for the ability to invest and grow money.
But women generally make for excellent investors, and the notable women investors throughout American history bear this out. In honor of Women’s History Month, learning how women have carved out a space for themselves in the American investment landscape is not only fascinating history, but also an excellent primer on best investment practices.
Though Abigail Adams is often only remembered for being the wife of John Adams and mother of John Quincy Adams, she also holds the distinction of being the first recorded female investor in American history.
John and Abigail Adams enjoyed a marriage of equals, wherein husband consulted with wife for major decisions. While the second president certainly asked his wife’s opinion on political matters, he gave over control of the family investments almost entirely to Abigail. And it was her aggressive and active investment strategies that allowed the Adamses to amass wealth.
Abigail Adams had several winning strategies for investing. For instance, she recognized the importance of purchasing assets when they were undervalued. At the time, land was considered a safe investment, and John wanted to invest all of his savings in real estate. Abigail convinced him to instead purchase depreciated government securities. This speculation earned her as much as 25% return per year, compared to the 1% return they could have received buying land and renting it out. Though the government bonds felt like a risky investment, Abigail was savvy enough to recognize that these securities would bounce back.
In fact, when Shays’ Rebellion of 1786-1787 made both federal bonds and those issued by the state of Massachusetts plummet in price, Abigail was one of the few who chose to invest more, rather than panicking and selling her federal securities. She recognized that the only way she would not benefit from this investment was if the rebellion led to war, at which point her investments would be the least of her worries. She wrote as much to her investment advisor, her uncle, Cotton Tufts: “Do not be afraid…if one sinks all must sink, which God forbid...It will never be at a lower ebb than at present unless actual war takes place.”
Though the American stock market was originally formed in 1792, there were no women stockbrokers until Victoria Woodhull and her sister Tennessee Claflin created their own brokerage in 1870, nearly 80 years later. But Woodhull’s career in investing started in a strange place: spiritualism.
The 19th century was rife with belief in the paranormal, and Victoria and Tennessee’s huckster father marketed the sisters as spiritualist mediums who could converse with the dead. One of their clients was the railroad magnate Cornelius Vanderbilt. Though he was a savvy businessman, Vanderbilt was also extremely superstitious and had recently lost his wife.
It’s not entirely clear how Woodhull won Vanderbilt’s trust, but she apparently gave him investing or business advice in the guise of conducting a seance. Vanderbilt was taken with the two sisters, and gave them financial help to open Woodhull, Claflin, & Co., the first for-women-by-women brokerage firm in the U.S.
The firm was a success. Despite the attitude at the time that there were not enough women with their own incomes to invest, Woodhull and her sister had tapped into an important market. They served “society wives and widows, teachers, small-business owners, actresses, and high-priced prostitutes and their madams,” and reportedly made $700,000 in the first six weeks (which is $13 million in today’s dollars).
It’s not entirely clear what investment strategies Woodhull and Claflin followed, and several accounts suggest that they used insider information to make their investing decisions. However, the sisters did recognize the importance of finding an underserved market. They geared their brokerage toward women, and created a women-only backroom in their offices, to ensure the comfort of their clients. Finding an untapped market and creating a product specifically for that market is an excellent way to turn an investment into wealth.
North Carolina Mutual Insurance was headquartered on Parrish St. in Durham, NC, which was known as Black Wall Street because of the number of African-American owned financial institutions located there. In 1920, NCMI hired 20-year-old Viola Turner as a cashier-clerk, before she eventually became personal secretary to Charles C. Spalding, one of the founders of the company.
Over time, as Turner worked her way up the ranks within the company, she proved her financial aptitude and was eventually placed in charge of the company investment portfolio. She decided to shift the company assets, consisting mainly of mortgages and government bonds, to stocks. Though she made this careful shift to riskier investments after studious research, making important contacts in the financial community, and wise trades, her investments were derisively referred to as “her little project” by a male colleague.
But the “little project” paid out big. Turner’s savvy investments earned the company over a million dollars on a $20 million investment, and this helped propel Turner herself into the executive suite. She was made Vice President in 1957, becoming NCMI’s first woman executive.
Turner recognized the importance of researching investments and not second-guessing herself, even if her colleagues were happy to denigrate what she was doing. Her strategies proved her detractors wrong.
While not every woman can be an Adams, a Woodhull, or a Turner, studies show that on the whole, women tend to be better investors than men, earning 0.4% more than men on average. While this may seem like a negligible amount, 0.4% per year over time adds up to quite a bit over time.
Adams, Woodhull, and Turner can help us understand why modern women are better at investing:
You can become an investor like Adams, Woodhull, and Turner right within the Unifimoney app. The app creates a portfolio for you, focusing on making frequent low-value investments. This strategy allows you to manage timing risk (buying when the market is high) and benefit from dollar-cost averaging. While it’s less risky than Adams’ investments in depreciated government securities, it follows a similar strategy: buy low and hold onto the investment so it can grow.
The Unifimoney app also allows you to invest your small change automatically, by default and without effort. This can make your change work for you, when most investors might ignore those small amounts of money. You can easily harness that overlooked money, just as Woodhull did with her female clients’ investment dollars.
And even if you don’t have the time or inclination to learn all about the assets and securities available to you, Unifimoney’s app offers Smart Investing. This allows you to invest in portfolios that are created by deep analysis of market trends using Advanced Machine learning techniques with the powerful Tenjin AI™ engine. So you don’t have to have Turner’s research skills and investment education to invest like her.
With Unifimoney’s help, you can invest like some of the most notable investment luminaries in American history.
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The above does NOT constitute an offer, solicitation of an offer, nor advice to buy or sell specific securities. The opinions listed above are not the opinions of Unifimoney Inc. or Unifimoney RIA, Inc. but represent the opinions of independent contributors. These contributors may or may not hold positions in the stocks discussed. Investors should always independently research any stocks listed and form their own opinions, while recognizing that any investments made may lose value, are not bank guaranteed and are not FDIC insured.