ETFs, Insights & News, Small Cap

We’re All Swifties Now

In the Taylor Swift Economy, WCEO Outperforms Other Small-Caps1

Image: Unsplash, TIFIN AMP Illustration

Taylor Swift makes a LOT of money. Okay, that’s not exactly a newsflash. Swift’s stratospheric rise and resulting gusher of wealth it’s created have been documented, debated, celebrated, and analyzed more than any other entertainer in recent history. 

And why not? Ms. Swift is the rare pop superstar who has transcended the music world and become a true cultural phenomenon. In perhaps one of the biggest surprises, her association with NFL superstar Travis Kelce has even crossed her over into the hypermasculine world of professional football and brought a legion of female fans along for the ride. With the breathtaking success of her record-breaking “Eras” tour – the first concert tour in history to gross over $1 billion –  she has now crossed that lofty threshold herself and has a personal estimated net worth of $1.1 billion according to Business Insider.


You belong with me

But the impact of this financial juggernaut goes far beyond Ms. Swift’s own personal finances. Examined in totality, Swift, Inc. is now for all intents and purposes a multinational conglomerate with an incredibly charismatic CEO and fiercely devoted adherents. According to Bloomberg Economics, the current tour has added some  $4.3 billion to America’s gross domestic product alone. It’s expected to have a similar effect on the economies of South America, Asia, Australia, and Europe when she tours those areas late in 2023 and throughout 2024. 

While it’s entertaining to talk about the impact of women in popular culture on the economy, something far more significant is quietly taking place in decidedly less glamorous, but arguably more important arenas. Female CEOs are having a notable impact on business results for the companies they lead – and that has compelling ramifications for investors.

Female CEOs are starting to attract their own devoted fan bases by making their presence felt on the investment landscape. A recent Korn-Ferry study, noted that firms with female CEOs saw a 20% increase in stock price momentum, a measure of positive price trend, compared to their male counterparts in the executives’ first 24 months in office.” 

So, where can investors capitalize on these performance trends? And why is now the time to urgently consider the possibilities of investing in women-led companies?


The Hypatia Capital WCEO ETF2 

The WCEO ETF is attracting growing interest – and with good reason. This thematic small cap ETF solely invests in companies with women CEOs. According to Morningstar, the small-cap companies, which constitute the comparable data set to the WCEO ETF, have 20% women in their senior leadership teams. Companies led by female CEOs, however, have 35% women on their leadership teams. So, by investing in WCEO and female executives at the helm, you’re also contributing to the overall diversity of that company.

But what makes the fund truly stand out is its role in catalyzing tangible transformation. By investing in companies that are truly committed to gender equality and female leadership, investors exercise their financial power to actively drive change. Hypatia Capital’s thesis is this approach allows investors to be integral to driving change, enabling them to influence corporate cultures and practices without being hamstrung by political or economic obstacles. And the results are clear: WCEO is outperforming competing funds in this category. 

As intriguing as it may be to talk about the Swift Effect, it symbolizes a larger conversation that exceeds the bounds of pop culture. We know the business world is undergoing a paradigm-shifting transformation, and acknowledging the benefits of female leadership isn’t just prudent; it’s a fiduciary imperative. WCEO gives investors an unparalleled opportunity to jump into the blank space of investing in real-world trailblazers and industry pioneers who are radically rewriting the narrative of female leadership and making their own beautiful music. 

– The TIFIN AMP Team

Hypatia Capital is a TIFIN AMP Partner

1Smaller capitalization securities involve greater issuer risk than larger capitalization securities, and the markets for such securities may be more volatile and less liquid. Specifically, small capitalization companies may be subject to more volatile market movements than securities of larger, more established companies, both because the securities typically are traded in lower volume and because the issuers typically are more subject to changes in earnings and prospects.

Securities of small and medium-sized companies tend to be riskier than those of larger companies. Compared to large companies, small and medium-sized companies may face greater business risks because they lack the management depth or experience, financial resources, product diversification or competitive strengths of larger companies, and they may be more adversely affected by poor economic conditions. There may be less publicly available information about smaller companies than larger companies. In addition, these companies may have been recently organized and may have little or no track record of success.

2Exchange Traded Funds (ETF’s) are sold by prospectus. Please consider the investment objectives, risks, charges, and expenses carefully before investing. The prospectus, which contains this and other information about the investment company, can be obtained from the Fund Company or your financial professional. Be sure to read the prospectus carefully before deciding whether to invest

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