Fidelity Investments: A Long-Standing Financial Powerhouse

Fidelity Investments, formerly known as Fidelity Management & Research (FMR), is an American multinational financial services corporation based in Boston, Massachusetts. The company was founded in 1946 by Edward Johnson II and is currently run by his granddaughter, Abigail Johnson, who is the CEO and chairman. Fidelity Investments is one of the largest asset managers in the world, offering a wide range of financial products and services to its clients. With a long history spanning over seven decades, the company has grown and expanded its operations, becoming a trusted name in the financial industry.

Founded in 1946 by Edward Johnson II

Fidelity Investments, formerly known as Fidelity Management & Research (FMR), was founded in 1946 by Edward Johnson II. Headquartered in Boston, Massachusetts, it is one of the largest mutual fund companies in the US, offering financial products and services to over 40 million individuals.

The company was established as the "Fidelity Fund" and was incorporated in Massachusetts on May 1, 1930. During the Great Depression, it was the only fund approved by John C. Hull, the Securities Director for Massachusetts, due to widespread bank failures in 1930. In 1946, the fund's corporate structure changed, and it became known as Fidelity Management & Research (FMR).

Fidelity Investments has grown significantly since its founding and is now one of the largest asset managers in the world, with trillions of dollars in assets under management and administration. The company operates a brokerage firm, manages mutual funds, and provides a wide range of financial services, including fund distribution, investment advice, retirement services, wealth management, and more.

The founding Johnson family still owns 49% of the company and plays an active role in its management. The remaining 51% is owned by Fidelity employees and ex-employees. In 2015, Abigail Johnson, the granddaughter of Edward Johnson II, became the CEO of Fidelity Investments, succeeding her father, Edward Johnson III, who had been CEO since 1977.

Became Fidelity Investments in 1930

The history of Fidelity Investments stretches back several decades, with the company undergoing a range of developments and transformations since its early days. While the firm has become a prominent name in the financial world, its origins can be traced back to the 1930s, specifically May 1, 1930, when it became known as Fidelity Investments under Edward C. Johnson II. This marked a significant step in the company's journey, and it's interesting to explore how it evolved during this period.

During the 1930s, the United States was grappling with the Great Depression, which had far-reaching effects on the economy and society. It was during this turbulent time that the "Fidelity Fund" transitioned to become Fidelity Investments. The widespread bank failures of 1930 highlighted the importance of stable financial institutions, and the "Fidelity Fund" stood out as the only fund approved by John C. Hull, the Securities Director for Massachusetts, during his term in office. This approval was a testament to the fund's reliability and stability, even amidst economic uncertainty.

The 1930s also set the stage for the company's long-term success and growth. With the country in the midst of the Great Depression, many Americans were seeking reliable financial services and investment opportunities. By establishing itself during this challenging period, Fidelity Investments positioned itself as a trusted partner for individuals and businesses navigating uncertain economic times. The company's ability to withstand the financial turmoil of the era likely contributed to its reputation for stability and longevity.

Moreover, the 1930s marked a pivotal decade for the development of financial services and investment strategies. With the stock market crash of 1929 still fresh in people's minds, there was a growing recognition of the need for more robust and diversified investment approaches. This period saw the emergence of new ideas and innovations in the financial industry, and Fidelity Investments was at the forefront of these developments. The company's leadership during this time likely played a crucial role in shaping its future success and influence in the financial sector.

In addition to its focus on financial services and investments, Fidelity Investments also established a strong foundation during the 1930s. This included building a solid client base, developing a network of connections, and establishing the company's culture and values. The company's early years laid the groundwork for its future expansion and diversification into various financial sectors. By the time World War II began, Fidelity Investments had already established itself as a prominent and trusted financial institution in the United States.

In summary, the evolution of Fidelity Investments during the 1930s played a pivotal role in shaping its future success and influence. The company's establishment during this decade, coupled with its ability to navigate economic challenges, positioned it as a trusted financial partner for individuals and businesses. The 1930s set the stage for Fidelity Investments' long-term growth and transformation into one of the largest and most respected financial services corporations in the world.

The Johnson family owns 49%

The Johnson family has a long history with Fidelity Investments. Abigail Johnson's grandfather, Edward C. Johnson II, founded the company in 1946, and it has remained a family-owned business ever since. The family's involvement has been instrumental in shaping the company's success and direction over the years.

Abigail Johnson has been with the company since 1988, when she joined as an analyst and portfolio manager after graduating from Harvard Business School. She worked her way up through the ranks, becoming president of Fidelity Asset Management in 2001 and Head of Retail, Workplace, and Institutional Business in 2005. She was named president of the company in 2012 and CEO in 2014, taking full control of Fidelity with 45,000 employees worldwide.

Under Abigail Johnson's leadership, Fidelity has continued to grow and evolve. In 2018, she introduced cryptocurrency investment at Fidelity, allowing institutional investors to trade Bitcoin and Ether. As of September 2023, Fidelity had $4.4 trillion in managed assets, solidifying its position as one of the world's largest mutual fund companies. The company has also expanded its offerings to include innovative products and services, such as the introduction of a Bitcoin ETF and the launch of a separate entity dedicated to institutional cryptoasset custody and cryptocurrency trading.

The Johnson family's influence extends beyond just their ownership stake. They have played a crucial role in shaping the company's culture and strategic direction. Their long-term focus and commitment to innovation have helped Fidelity maintain its position as a leading financial services provider. The family's involvement has also contributed to the company's stability and ability to make decisions with a long-term view, benefiting its clients and employees alike.

Abigail Johnson is current CEO

Fidelity Investments, formerly known as Fidelity Management & Research (FMR), is an American multinational financial services corporation based in Boston, Massachusetts. The company was established in 1946 by Edward C. Johnson II, grandfather of current CEO Abigail Johnson.

Abigail Johnson is an American billionaire businesswoman and the granddaughter of the founder of Fidelity Investments. She has been president and chief executive officer (CEO) of the American investment firm since 2014 and chair of its former sister company Fidelity International (FIL) since 2016. Johnson was named on Forbes' list of "The Richest Person In America's 50 Largest Cities" in 2016 and ranked eighth in 2023 on their "World's 100 Most Powerful Women" list. She has been the richest person in Massachusetts since at least 2015 and is worth approximately $35.6 billion as of June 2024, making her one of the world's wealthiest women.

Johnson was born in Boston, Massachusetts, on December 19, 1961. She attended the private school Buckingham Browne & Nichols School in Cambridge, Massachusetts, and graduated from William Smith College with a bachelor's degree in art history in 1984. After working as a consultant at Booz Allen Hamilton, she completed an MBA at Harvard Business School. Johnson joined Fidelity Investments in 1988 as an analyst and portfolio manager. In 2001, she was promoted to president of Fidelity Asset Management. She was named president of the company in 2012 and succeeded her father, Edward Johnson III, as CEO in 2014. Johnson introduced cryptocurrency investment at Fidelity in 2018, making it possible for institutional investors to trade Bitcoin and Ether.

The company is headquartered in Boston

Fidelity Investments, formerly known as Fidelity Management & Research (FMR), is an American multinational financial services corporation. The company is headquartered in Boston, Massachusetts, and was established in 1946. It is one of the largest asset managers in the world, with trillions of dollars in assets under management and administration.

The company's headquarters in Boston reflects its long history and established presence in the United States, particularly in the financial industry. Boston is a major city in the Northeast, known for its financial and economic significance. By having its headquarters in this city, Fidelity Investments gains access to a talented workforce, strong infrastructure, and proximity to other major financial institutions and markets.

The Boston headquarters serves as the central hub for the company's operations and decision-making. It houses the executive team and key functional departments, such as finance, marketing, and strategy. The location of the headquarters also influences the company's culture and values, as Boston is known for its rich history, academic excellence, and innovative spirit.

Fidelity Investments' choice to locate its headquarters in Boston can be attributed to several strategic factors. These may include access to a skilled talent pool, as Boston is home to top universities and business schools. The city also offers a vibrant ecosystem for financial services, with many other financial institutions and startups in the area. Additionally, Boston may provide a stable and supportive business environment, with favourable tax policies and incentives for companies in the financial sector.

The company's presence in Boston also allows it to tap into the city's diverse and innovative startup culture. This can foster collaboration and the exchange of ideas, benefiting Fidelity Investments' own culture of innovation and its ability to adapt to changing market demands.

Frequently asked questions