New Federal Reserve Chairwoman Janet Yellen soon will have more influence over Wall Street and the economy than anyone else in the world, but in her personal portfolio, she looks a lot like an average investor.
The incoming Fed leader, who was confirmed by the Senate on Jan. 6, puts her assets largely in bond and equity index funds and blue-chip stocks, according to her financial disclosure on file in the Government Ethics Office.
The way she selects her investments suggests that as a longtime Federal Reserve official, she didn't want to send loud signals to the market. Ms. Yellen had been Fed vice chairwoman and prior to that, head of the Fed's San Francisco bank.
“What jumps out at me is the conventionality of it,” said Arthur Grant, president and CEO of Cadaret Grant & Co. Inc. “This looks like a quintessential asset allocation strategy. She knew it would be scrutinized for her philosophy of investing.”
Investment advisers described Ms. Yellen as largely avoiding risk while still participating in the market.
“She's taking the long view,” said Dave O'Brien, owner of O'Brien Financial Planning Inc. “It looks prudent.”
In taking a risk-averse investing approach, Ms. Yellen is essentially showing confidence in the Fed's ability to manage the economy.
“One of the things she's not doing is making a bet against bonds,” Mr. Grant said.