Citigroup To Lady Investors: Take It From Us, Markets Are Tough!

Illustration for article titled Citigroup To Lady Investors: Take It From Us, Markets Are Tough!

The financial services industry is reaching out to the FabSugar demographic! Citigroup — which is a really big bank, in fact maybe the biggest bank, but you probably know it for being the employer of that dashing banker Maria Bartiromo maybe-fucked on that private jet because all you read is "Page Six" — is the company leading this effort. In new ads set to run in Vogue, O and Real Simple, the company is telling us to stop investing in Balenciaga and start investing in ... actual investments! Which is a message we would normally endorse, but, like:

"Dividends are a girl's best friend" and "Something old, something new, something borrowed, something blue chip," are headlines launching in print ads this month.

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Which is, like, totally cute and all, and not necessarily bad advice in a market like this. But, like, "dividends" and "blue chips" are, like, the kinds of things you tell your grandparents, and people with heart conditions, to buy.

What of emerging markets? High-margin growth stocks? High profile stocks that have taken a beating recently? What are they, afraid we'll be as stupid as all the men who invested in securities backed by the no-down-payment mortgages of indebted Americans? Don't worry, we've TOTALLY cut up too many credit cards to make that mistake!!

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DISCUSSION

There's a reason that you rarely see financial services ads directed at women. It's because women, on average (yes, yes there is a wide variation, but on average...) are really shitty customers. They don't trade in and out, don't generate big commissions, don't chase past returns, don't buy high and sell low to the same extent as men. This is good for retirement portfolios, but terrible for Citigroup's business model.

After all, how much money would you make telling someone, man or woman, to invest in Vanguard index funds at 30 bps MER?

I love my testosterone as much as the next man, but I'm very happy that my wife is smarter (ie, more risk-averse) about money than I am.

Oh, and dividends are not necessarily a girl's best friend, or a boy's either. Modigliani & Miller proved 50 freakin' years ago that dividends make little difference compared to any other method of spinning cash back to shareholders (such as buybacks).