As he continued to focus on what would best serve everyday investors, Adams played a critical role in fine-tuning the firm’s holdings, assembling a diversified portfolio of stocks that represented “a composite investment in American industry.”9,10 Knowing that transparency was also essential for earning the trust of shareholders, Adams championed the radical idea that MIT should publish transparent investment reports that revealed the fund’s holdings and other details about the firm’s operations, information which virtually no other manager was willing to share with investors.11
Adams and the other trustees prioritized diversification, liquidity, conservative portfolio management and transparency, which proved critical in helping MFS weather the Great Crash of 1929 and the ensuing Great Depression.12 While the general public’s faith in the markets plunged during the 1930s, its faith in MFS grew with each passing year, as the firm was one of the few safe havens helping investors regain their financial footing during an economic crisis.13
By the time Adams retired in 1952,14 MIT had solidified its standing as the largest open-end mutual fund in the world — largely driven by Adams’ experience, passion and his dedication to the financial success of everyday people. As CNBC anchor and market scholar Bill Griffeth wrote in his book The Mutual Fund Masters, Adams’ influence on the development of MIT made him “arguably the father of the modern mutual fund.”15
Please note: Not all of the funds included in this material may be available for sale in your country.
Endnotes
1Grow, N. (1977).
The “Boston-type open-end fund”: Development of a national financial institution 1924–1940. Harvard University. (Unpublished doctoral dissertation or master’s thesis). Page 94; and Silberman, H. (1974).
50 Years of Trust: Massachusetts Investors Trust, 1924–1974. Massachusetts Financial Services, Inc. Pages 3–4.
2 Wilson, J. (1949)
A Story of Progress: On the Twenty-Fifth Anniversary of Massachusetts Investors Trust. Massachusetts Investors Trust.
3 Robinson, D. (1954).
Massachusetts Investors Trust: Pioneer in Open-End Investment Trusts. The Newcomen Society in North America. Page 12.
4 MFS Turns 75. (1999)
MFS Perspective. Vol 5, No. 1.7. Page 14; Wilson, page 10; Silberman, page 2.
5 Rottersman, M. & Zweig, J. (1994).
An Early History of Mutual Funds. Friends of Financial History. Museum of American Financial History. Vol. 51. Page 15.
6 Griffeth, B. (1995).
The Mutual Fund Masters. Probus Publishing; and Silberman, page 3.
7 Silberman, page 10.
8 Hall, B. & Lim, J. (2004). Massachusetts Financial Services. Harvard Business School Case Study 9-902-132.
9 Griffeth, pages 1–2.
10 Wilson, page 16.
11 Wilson, pages 15–16.
12 Willis, C. (February 1999). Present at the Creation.
MF Magazine.
13 WALL STREET: The Prudent Man. (1959)
Time Magazine.
http://content.time.com/time/subscriber/article/0,33009,811169-1,00.html
14 Grow, page 58.
15 Griffeth, page 11.