Episode 65

Published on:

12th Jul 2023

065: Julie Cane - Investing in Democracy & Making an Impact

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Julie Cane is the CEO and co-founder of Democracy Investments, a registered investment advisory firm focused on promoting democracy and influencing capital flows in financial markets. The firm’s democracy investments international index re-weights the traditional international equity index towards democracies and away from authoritarian regimes using the Economist’s Democracy Index.

Today, Julie joins the show to discuss index strategies, what inspired her and her team to focus on democracy as a criteria for investment and what the future may hold for index fund investing.

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Key Takeaways

00:02 – Jonathan introduces today’s guest, Julie Cane, who joins the show to talk about her first experiences with money and her career trajectory in the financial services industry

08:09 – Understanding Index strategies and the concept of ‘weighting’

11:31 – How Julie and her partners decided to focus on democracy

15:30 – The importance of understanding where international investments are going to support

17:40 – The case for why a democracy might outperform an authoritarian state in the long run

20:16 – Factors that go into The Economist’s Democracy Score

22:49 – A whole new category of investing

25:33 – Environmental, Social, Governance (ESG) investing

27:07 – Julie speaks to the challenges of launching her own business and upcoming projects

32:23 – The last thing Julie changed her mind about and one place she has visited that had a profound impact on her

34:54 – Jonathan thanks Julie for joining the show and the impactful work she is doing

Tweetable Quotes

“I was drawn to financial services because I felt like money - the economy - that’s where you have impact. I’ve always been mission-driven and I wanted to choose a path where I felt motivated in the same way. How can I help contribute to making the world a better place and I thought of financial services.” (06:49) (Julie)

“The more actively you manage a strategy, the more you’re gonna have higher fees and higher transaction costs. So that has to be weighed when deviating from the traditional market cap approach.” (10:36) (Julie)

“What we do is we hold every country accountable to their ‘Democracy Score’ as defined by The Economist magazine. It’s simple and transparent and systematic.” (13:14) (Julie)

“Democracies enforce rule of law and property rights. There’s a more efficient and transparent use of capital. They have higher per capita GDP. They have better innovation. So, our hypothesis is that democracies will outperform authoritarians in the long run and that companies will try to do their business in countries that support the transparent use of capital.” (18:22) (Julie)

“We [The United States] are a flawed democracy. We stayed the same in our ranking because we went up in political participation because more people voted. But we went down in the functioning of government.” (20:58) (Julie)

Guest Resources

Julie’s Website

Link to White Paper

Julie’s LinkedIn

The Economist

Ticker Symbol: $DMCY

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About the Podcast

Mindful Money
Do you struggle with money? You’re not alone.
Money is a means, not an end. It’s a necessity of life for sure, but more money does not always guarantee a “good life”. Money enables many aspects of modern life, but as a dominant consideration it becomes destructive. 
The paradox is that more time and energy spent on personal finance does NOT create better outcomes. Unlike many other parts of life, we can’t create better outcomes by being smarter, spending more time, or putting in more effort.
Join Mindful Money author and experienced 40-year investor Jonathan DeYoe as he shares stories from artists, authors, entrepreneurs, and other advisors about how they mindfully minimize their need to think about money and get more out of life.
If you aren’t happy with your finances, feel like money takes more time that it should, or want to place your financial decisions into the broader context of your life, this show is for you. 
Each episode will draw the line between the “enough” activities that the academics tell us are additive to family outcomes, and those “little bit more” efforts that take time and sap energy, but do NOT improve outcomes.

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Jonathan DeYoe

Jonathan DeYoe is a best-selling author, speaker, financial advisor and angel investor. He is a husband, father and a practicing Buddhist. His simple underlying message brings a welcomed sense of order to financial chaos and restores a calm center to your financial life.