This week will mark a historic milestone for women in the United States: the first woman of color on the Supreme Court Sonia Sotomayor will swear in Kamala Harris, the first person of color and the first woman to serve as vice president of the United States. The Biden administration is poised to break ground in other ways, too. A record number of women have been appointed in the Biden cabinet compared to his six predecessors, according to Brookings Institute research. This includes Janet Yellen, who is poised to be the first female secretary of the Treasury.

Still a Minority

Beyond these historic milestones, there is an area where gender parity continues to fall short: female retail investors remain a minority. A study by Cerulli Associates and Phoenix Marketing found that only 28% of women own stocks compared to 44% of men, and only 28% of women want to manage their own investments compared to 38% of men, according to The Wall Street Journal.

In addition to the lower percentages of women who are active investors, UBS data showed that women were still not taking charge of their financial decisions within their own households going into the pandemic. Robinhood, The Charles Schwab Corporation (SCHW), Fidelity, and relative newcomers like Ellevest see female clients as a key to growth, and they are looking to change the relative lack of participation by women in the financial markets.

On one side of the spectrum, for companies like Robinhood that have built their businesses around gamification of trading, attracting female customers would mean tweaking their approach. "The business model that Robinhood has right now is completely predicated on trading and that caters toward a more male demographic, they would have to change their business model," Larry Tabb, head of market-structure research at Bloomberg Intelligence, told The Wall Street Journal. "To attract female clients, they would have to include long-term investing strategies and wealth building."

On another side of the growing number of financial platforms, we have companies like Ellevest actively tailoring and marketing their offerings to women. Launched in 2014, Ellevest has been looking to address these core differences between male and female investors. Last year, the firm launched Ellevest Money membership, offering its clients more workshops, coaching, and investing options that include "gender differences in pay gaps, career breaks, and longer lifespans."

Without marketing themselves as female-focused financial instruments necessarily, other financial platforms also provide similar offerings. Financial institutions like Charles Schwab are aware that these differences start early: young women are half as likely as young men to have an investment account, according to the firm's 2018 financial literacy survey of the money attitudes of young adults. Charles Schwab's current offerings include a lot of educational resources, including workshops, consultations, and a number of podcasts.

Here’s the good news: The pandemic is forcing many more women to take charge of their finances. Fidelity Investments data shows about 67% of women say they are more engaged in managing their money since the start of the pandemic. Last year, Fidelity launched a weekly Q&A series called Women Talk Money in response to increasing questions from clients.

"Women and caregivers are being challenged like never before and are looking to become more informed and better prepared as they make financial choices for today and the future," said Lorna Kapusta, head of the women investors group at Fidelity. "We launched Women Talk Money to create an environment where we can address those pressing questions in a judgment-free environment."

While many of the financial tools and educational resources have existed for years, the COVID-19 pandemic may provide the urgency for female investors to take advantage of them and become savvier, more active market participants and planners for their financial future.