Edward C. Johnson 2d
Co-founder 1946Background
Founder of Fidelity Management and Research in Boston in 1946.
Role at Fidelity Investments
Fidelity Investments possesses a historic, dynastic founding story, rooted in the conservative financial establishment of Boston and dominated by a single, powerful family for three generations. The company was founded in 1946 by Edward C. Johnson II. Johnson was a brilliant, intellectual Boston lawyer and investor. Prior to founding Fidelity, he managed the Cromwell Fund. Johnson possessed a foundational belief that altered the mutual fund industry: he believed that mutual funds should not just be conservative, boring trusts that simply bought blue-chip stocks and never sold them. He believed in active, trading. His foundational motto was, 'Take calculated risks. That is quite different from being rash.' He founded Fidelity Management & Research (FMR) to manage a single fund, the Fidelity Fund. His success was built on intensely rigorous, detailed fundamental stock research, a novel concept at the time. The foundational pivot that created the modern empire occurred under his son, Edward 'Ned' Johnson III, who took over in 1972. Ned Johnson was a visionary regarding financial technology and distribution. He heavily invested in toll-free phone centers and computer networks, bypassing traditional brokers to sell mutual funds directly to retail investors. Ned also heavily backed a brilliant young manager named Peter Lynch, whose success with the Magellan Fund made Fidelity a global powerhouse. Today, the secretive company is run by the founder's granddaughter, Abigail Johnson, maintaining iron-clad family control over one of the most powerful financial institutions on Earth.