Abigail Johnson, the daughter of Fidelity Investments CEO Edward C. Johnson III, has been promoted to run almost all of the money management behemoth. The company was founded by her grandfather and she owns a large portion of the stock in the firm. The announcement has been expected for some time, as the power to oversee the company passes again from one generation to another.
Abigail may find her job more challenging that her father's, at least short term. Individual investors, the financial holdings of whom are a backbone of Fidelity sales, have drawn away from most equity investments to those that are safer. Even the mutual fund business has been hurt by this. Much of what Americans earn now goes to pay down debt they loaded on in the decade of the 2000s.
In addition, Reuters points out that Fidelity returns have been less than spectacular, as "Fidelity customers have withdrawn more money than they have added over the past few years."
Douglas A. McIntyre
Filed under: 24/7 Wall St. Wire, Mutual Funds