Investment News articles from April 2006

Investment News archives from April 2006

Touchstone fund offers access to veteran manager.(Street Wise)
April 3, 2006... Byline: Jeff Benjamin The Touchstone Large Cap Value Fund (TLCAX) hasn't had much time to make an impression on the investment community, but the story behind the fund has some history worth noting. The fund, launched March 14 with $11...

One on One With Eric Schwartz of Cambridge Investment Research Inc.(One on One)
April 3, 2006... Byline: Bruce Kelly NEW YORK - Eric Schwartz believes in fees. In fact, he has built his firm, Cambridge Investment Research Inc. of Fairfield, Iowa, on them. About 55% of the firm's gross revenue comes from fees, and Mr. Schwartz said...

What's with all the interest in growth managers?(Other Views)
April 3, 2006... Byline: William Berg We've had it wrong. We often write about the seemingly unwavering inclination of investors to chase performance, to buy whatever has gone up the most (and therefore is expensive) and to sell whatever has gone down...

Annuity options gaining sway with 401(k) plan providers; CitiStreet latest to join bandwagon.(News)
April 3, 2006... Byline: Jenna Gottlieb NEW YORK - CitiStreet LLC is the latest 401(k) provider jumping on the annuity option bandwagon. The Quincy, Mass.-based firm will begin offering an annuity option in client 401(k) plans by the middle of the...

Smaller can be better, but there are drawbacks.(The Markets)
April 3, 2006... Funds with total net assets in the $20 million to $100 million range have been in existence for nine years on average, while funds above $100 million have been around for an average of 13 years. Nine years may seem ample, but many investors...

State securities cops taking a hard look at hedge funds; NASAA forum, Conn. bill evidence of their concern.(News)
April 3, 2006... Byline: Sara Hansard WASHINGTON - State securities regulators are starting to look more closely at the $1 trillion hedge fund industry. The North American Securities Administrators Association Inc. is holding a forum tomorrow on hedge...

Court continues pattern of restricting damages from Wall Street firms.(Short Interests)
April 3, 2006... Byline: David Hoffman NEW YORK - A number of decisions were handed down last month in numerous civil lawsuits against various mutual fund companies, broker-dealers and traders, related to the mutual fund market-timing scandals. But...

Provincial regulator threatens Canadian dealer group's powers; IDA appeals Saskatchewan ruling.(News)
April 3, 2006... Byline: David Clarke OTTAWA - Could one province's securities regulator undermine the effectiveness of a key national regulator? That remains to be seen. But the Investment Dealers Association of Canada, a Toronto-based self-regulatory...

Advisers step into Canada high-court case.(News)
April 3, 2006... Byline: David Clarke OTTAWA - Advocis, The Financial Advisors Association of Canada, has been granted the right to intervene in a Supreme Court of Canada case. Specifically, the issue in Canadian Western Bank v. (the province of)...

Outside-the-box investment manager selection.(Investment Strategies)
April 3, 2006... Byline: Tim Knepp In an industry where investment manager selection often is heavily weighted toward past performance, it is important to consider the logic and process behind such thinking. As we all know, past performance is no...

Longer lifetimes may derail planning assumptions.(Short Interests)
April 3, 2006... Byline: Gary S. Mogel NEW YORK - Clients who stop working at age 65 may spend up to 935 years in retirement, according to researchers at several prestigious American and British universities. This will wreak havoc on the Social...

Spreading the wealth (management); Community banks rapidly are adding services.(News)
April 3, 2006... Byline: Charles Paikert NEW YORK - Call it the trickle-down effect: Community banks and smaller regionals are hopping on the wealth management bandwagon. "Growing community banks are moving very rapidly to expand wealth management...

Ranks of millionaires swell.(News)
April 3, 2006... Byline: Charles Paikert NEW YORK - There seems to be no letup in sight to the wealth management boom, according to a new report from by Greenwich, Conn.-based TNS Financial Services, a division of London-based market research firm Taylor...

Bush decries Democrats' economic stance.(Tax Watch)
April 3, 2006... Byline: Mark E. Battersby President Bush has gone on the offensive, blasting Democrats on economic issues. Both the president and Vice President Dick Cheney have suggested that the Democrats would stall economic recovery. "If you...

REIT returns baffle some advisers, please others; Many continue to use them as a way to diversify holdings.(News)
April 3, 2006... Byline: David Hoffman NEW YORK - The good returns that continue to be generated by real estate investments - particularly real estate investment trusts - puzzle Veena Kutler, a principal with financial advisory firm Mosaic Wealth...

Smith Barney agrees to pay $50M in suit; Stocks of investment banking clients allegedly favored.(News)
April 3, 2006... Byline: Dan Jamieson IRVINE, Calif. - Smith Barney has agreed to settle a class action alleging that the firm loaded up customers of its broker-managed fee-based accounts with stocks of investment banking clients. Under terms of the...

Signs point to rocky markets ahead.(Short Interests)
April 3, 2006... Byline: Jeff Benjamin DETROIT - The bad news is that the second and third quarters this year coincide with a presidential-term cycle for what historically has been the worst six-month stretch for the stock market, as measured by the...

Street has 'temper tantrum' over rate hike.(Monday Morning)
April 3, 2006... Byline: Mike Clowes The stock market threw a temper tantrum last week when the Federal Reserve had the nerve to raise the federal funds rate another quarter of a percentage point to 4.75%. Traders and investors were additionally...

'Survivor bias' inflates fund returns, study says.(Short Interests)
April 3, 2006... Byline: Sara Hansard WASHINGTON - A group of investment advisers that uses index funds last week charged that there is a "survivor bias'' in data on actively managed mutual funds compiled by leading mutual fund research company Morningstar...

IRS plan jeopardizes taxpayer privacy.(Editorial)
April 3, 2006... The Internal Revenue Service is proposing to change rules that would give tax preparation organizations the right to sell information from an individual's tax return forms to marketers and data brokers. It is a terrible idea. The IRS...

Calendar.(Calendar/Datebook)
April 3, 2006... April 4 - Second annual Small Firms Forum, Securities Industry Association. New York Marriott Financial Center. (212)618-0587 or rgannon@sia.com. 5-8 - On-campus intensive-learning program, GS 811 Security Analysis and Portfolio...

Citi's new toaster: Free 4.5% savings account.(Reverse Spin)
April 3, 2006... Byline: Frederick P. Gabriel Jr. Competition is heating up in the Internet banking arena. Citibank NA, the retail-banking arm of New York's Citigroup Inc., Wednesday launched a high-yield online savings account called Citibank Direct....

Advisers ramping up the use of P&C insurance in plans; Bank competition among the reasons.(News)
April 3, 2006... Byline: Gary S. Mogel NEW YORK - Financial advisers increasingly are incorporating property-casualty insurance into their planning practices, partly to compete with banks that already provide this service, according to industry observers....

Electronic-trading pioneer faces good news and bad; Stock, revenue up, but rivals multiply as CEO eyes exit.(News)
April 3, 2006... Byline: Aaron Elstein CNS NEW YORK - When Investment Technology Group Inc. started trading on the New York Stock Exchange in 1999, chief executive Ray Killian jubilantly rang the opening bell and tossed hats with his company's logo down...

CD of parodies seen as polishing accountant image.(Short Interests)
April 3, 2006... Byline: Thomas N. Zadvydas NEW YORK - A novelty music company has decided to poke a little fun at Uncle Sam, just in time for tax season. Ruby Tunes LLC of Wellesley, Mass., released "Taxpayer Blues,'' a comic CD about the accounting...

Credit insurer forecasts slump.(Short Interests)
April 3, 2006... Byline: Aaron Siegel NEW YORK - The U.S. economy's wheels may soon run out of grease. The global economy looks bright, but weakness in the airline and automotive sectors is hurting the U.S. economy, finds "Expectations for the U.S....

Efficient frontier: Is it market timing in disguise?(Other Views)
April 3, 2006... Byline: Jim Otar Efficient-frontier theory is one of the pillars of current investment practice. First defined in 1952 by Harry Markowitz, it shifted the focus from individual securities to the entire portfolio. Nowadays, it is used...

ETF industry's next challenge is getting products to investors; New varieties will have to look at sector indexes, experts say.(Exchange Traded Funds)
April 3, 2006... Byline: David Hoffman NEW YORK - With more than 220 exchange traded funds, the ETF marketplace has matured to the point where its next challenge won't be to unveil products but to find new ways to get its products into the hands of...

Firms show execs the money; Base salaries took a dip in '05, but big bonuses grew.(News)
April 3, 2006... Byline: Frederick P. Gabriel Jr. BOSTON - Despite rising complaints about excessive compensation, directors at financial services companies that manage assets are handing out big bonuses to their top executives. The average top...

New foreign legion: Advisers look abroad; Some recommend 50%+ overseas position.(News)
April 3, 2006... Byline: Brooke Southall SAN FRANCISCO - Financial advisers are investing overseas with a vengeance. After more than a decade of investing mainly in large U.S. companies, more advisers are turning outside the United States in search of...

Amex's Wolkoff discusses plan to go public; Exchange seeks access to capital for branding, technology.(News)
April 3, 2006... Byline: Aaron Siegel NEW YORK - Following in the footsteps of the New York Stock Exchange, which recently went public, the American Stock Exchange is preparing its own initial public offering, said chief executive Neal L. Wolkoff. The...

Forget Oscar! Advisers to vie for The Chuck each year.(News)
April 3, 2006... Byline: Brooke Southall SAN FRANCISCO - Charles Schwab & Co. Inc. is taking a stab at identifying the nation's very best financial adviser as it launches an award named after founder Charles R. Schwab. The San Francisco-based brokerage...

Assets in Schwab mutual funds managed actively doubled in '05; Skilled stock picking said to create a competitive advantage.(News)
April 3, 2006... Byline: Brooke Southall SAN FRANCISCO - The Charles Schwab Corp. at long last is developing a following among financial advisers for its actively managed equity mutual funds. Assets in those funds from the San Francisco-based brokerage...

People.
April 3, 2006... TIAA-CREF of New York has named Scott C. Evans, 46, executive vice president of the organization's newly created asset management area and chief executive of investment advisory subsidiaries Teachers Advisors Inc. and TIAA-CREF Investment...

Worried compliance officers wait for new SEC ruling.(Conference Call)
April 3, 2006... Byline: Charles Paikert NEW YORK - With concerns mounting among investment advisers as the Securities and Exchange Commission gets ready to issue a new rule on e-mail retention and monitoring, the area is "a hotbed of activity,'' according...

SEC, NASD, Florida target 'free lunch' seminars; Initiative to protect elderly coincides with AARP effort.(News)
April 3, 2006... Byline: Sara Hansard WASHINGTON - Federal and state regulators intend, as part of sweep exams, to crack down on brokerage and investment advisory firms in Florida that use "free lunch'' seminars to sell products to older Americans. ...

Merrill loses first round in legal battle; Gorman fight could continue in arbitration.(News)
April 3, 2006... Byline: Dan Jamieson IRVINE, Calif. - Merrill Lynch & Co. Inc. has lost round one in a nasty legal dispute with its former head of retail, James Gorman. Last Thursday, a state court judge lifted a temporary restraining order that had...

Closing Quote.(Quotes)
April 3, 2006... "Amex has always been the ugly stepchild of the New York markets.'' Junius Peake, Monfort distinguished professor of finance at the University of Northern Colorado in Greeley, on his skepticism that the American Stock Exchange can be...

At the Bell; FASB proposes transparency idea.(Late News)
April 3, 2006... The Financial Accounting Standards Board on Friday proposed requiring employers to report overfunded or underfunded positions of defined benefit post-retirement plans - including pension plans - on their balance sheets. Employers would...

Exchange Traded Funds.(News)
April 3, 2006... Although there has been some talk of actively managed ETFs, the Securities and Exchange Commission, at least so far, has not expressed confidence in the idea. Most likely, that means that passively managed indexed-based products will continue...

Plugging gaps in insurance knowledge.(Conference Call)
April 3, 2006... Byline: Gary S. Mogel NEW YORK - From empty nesters to young singles, one thing that adult Americans of all ages seem to have in common is an inability to incorporate insurance into their financial planning effectively. That was among...

HSAs are creating new bedfellows; Banks, broker-dealers are forging alliances.(News)
April 10, 2006... Byline: Gary S. Mogel NEW YORK - Health savings accounts are increasingly bringing together banks and broker-dealers that individually may lack the ability to both service the accounts and invest the assets. Health insurers and banks...

FASB deserves credit for its persistence.(Monday Morning)
April 10, 2006... Byline: Jim Pavia Greater transparency is needed to make it easier for investors to understand corporate financial reports, which have become ever more complex as business has become more complex. The Financial Accounting Standards...

Shining a light on pension set-asides.(Editorial)
April 10, 2006... The Financial Accounting Standards Board has proposed tighter standards for the reporting of corporate-pension and other post-retirement benefits. The proposed standards would require companies to recognize on their balance sheets the...

Helping auto workers to keep on truckin'; Advisers offer clients structure, reality checks.(News)
April 10, 2006... Byline: Charles Paikert NEW YORK - Exercise tough love, have a thick skin and don't forget blocking and tackling. That's what is needed when dealing with clients facing job loss or buyout and early retirement decisions in the wake of...

First round of major compliance tests ends; Broker, RIA worries about regulators' expectations persist.(News)
April 10, 2006... Byline: Dan Jamieson IRVINE, Calif. - Brokerage and investment advisory firms worried about meeting tough new compliance procedures are breathing a bit more easily, and some even saw the process as a learning experience. The deadlines...

Advisers gravitating to non-traded REITs; More than $18B invested over last three years.(News)
April 10, 2006... Byline: Jeff Benjamin DETROIT - Low volatility and steady dividend income are cited as the main drivers behind a three-year growth spurt for direct investment programs that are dominated by the once-controversial non-traded real estate...

Closing Quote.(Quotes)
April 10, 2006... "You can't eat your living room.'' Ted Bugenski, a certified financial planner who is a vice president with Troy, Mich.-based registered investment adviser William Mack & Associates Inc., on advising clients who are facing layoffs to put...

One on One With Robert Aaron of the Managed Funds Association.(One on One)
April 10, 2006... Byline: Jeff Benjamin Robert Aaron has become well versed in the world of regulatory oversight with regard to hedge funds. As chairman of the Managed Funds Association since October, he has seen the Washington-based group go from...

Book, report call for wealth management changes; Boomers, wealthy clients demand new model, authors contend.(News)
April 10, 2006... Byline: Charles Paikert NEW YORK - Wealth management needs a makeover, according to a new book and a separate research report on the subject. The differing interests of advisers and wealthy clients need to be aligned and managed more...

NASD's attack on platform deals tapers off.(Reverse Spin)
April 10, 2006... Byline: Frederick P. Gabriel Jr. At long last, the crackdown by regulators on brokerage firms that accept money from fund companies to gain favored status on their platforms is running out of steam. "We've brought a lot of cases,...

Court making SEC revisit rule on board independence; Sides with Chamber on governance reg.(News)
April 10, 2006... Byline: Sara Hansard WASHINGTON - In a big loss for the Securities and Exchange Commission, a federal appeals court Friday sent the landmark mutual fund governance rule back to the SEC for reconsideration. The U.S. Court of Appeals for...

SIA may align with bond group.(Short Interests)
April 10, 2006... Byline: Sara Hansard WASHINGTON - The proposed merger of the Securities Industry Association and The Bond Market Association is a recognition that trading desks are coming together, said an official with the bond group, who declined to...

Green groups go after TD Bank.(Short Interests)
April 10, 2006... Byline: David Clarke OTTAWA - Is TD Bank Financial Group green-washing poor performance? It is, according to ForestEthics and the Rainforest Action Network, both of San Francisco. The organizations released a report March 30, "TD...

Winning the hearts and assets of boomer retirees.(Other Views)
April 10, 2006... Byline: Mark Elzweig and Nancy Miller About a year ago, we wrote in this space about how financial advisers weren't fully prepared for the upcoming wave of baby boomer retirees. Since that time, we have studied the research on this...

Gridlock grinds tax conference to a halt.(Tax Watch)
April 10, 2006... Byline: Mark E. Battersby Little progress has been reported on the tax reconciliation bill conference, with negotiations unlikely to be completed before the Easter recess, according to legislators. That conference is taking place...

NASD bumps up sanctions for trading violations; Some broker-dealers are crying foul.(News)
April 10, 2006... Byline: Dan Jamieson IRVINE, Calif. - NASD has increased the sanctions it levies against brokerage firms for trading violations, and some broker-dealers aren't happy about it. Under sanction guidelines that went into effect March 31,...

Disability insurance illiteracy spells trouble; Agents, public need education on policies, Hartford finds.(News)
April 10, 2006... Byline: Gary S. Mogel NEW YORK - A lack of understanding as to the cost of disability insurance and what it covers is causing many people to avoid buying such policies, a recent study found. "The industry has become more complex than...

Whopper of a debit card goof decimates bank account.(Short Interests)
April 10, 2006... Byline: Gary S. Mogel NEW YORK - Buying four hamburgers for more than $1,000 each can really eat into a bank balance, a couple in California found out last month. A Burger King drive-through cashier in Palmdale punched in $4,334.33...

Financial-literacy efforts failing to make the grade.(Short Interests)
April 10, 2006... Byline: Thomas N. Zadvydas NEW YORK - Virtually no improvement in the financial-literacy levels of high school students has been achieved during the past two years, according to the findings of a biennial national survey. Results show...

Have mutual funds beaten legal rap? All but two of 44 suits have been resolved.(News)
April 10, 2006... Byline: Frederick P. Gabriel Jr. BOSTON - The litigation-besieged mutual fund industry has largely dodged a legal bullet - for now. Nearly all of the 40-plus lawsuits against such fund companies as Merrill Lynch & Co. Inc., The...

Upstart Focus Financial aims its slingshot at NFP; Says rival's size, type of partners turn prospects off.(News)
April 10, 2006... Byline: Brooke Southall SAN FRANCISCO - Focus Financial Partners LLC took a year to get off the ground - with fewer firms than it had hoped - but its chief executive says that it is now ready to take aim at the 800-pound gorilla of...

Portfolios that are dressed for success.(The Markets)
April 10, 2006... We used our recently published methodology to identify funds having a 60% or better chance of doing well over the next 12 months. The following list is a sample of world stock funds meeting our filtering criterion of having been a Lipper Leader...

Smith Barney plan said to fall short; Creating elite group fails to address conflict-of-interest issue, critics argue.(News)
April 10, 2006... Byline: Brooke Southall SAN FRANCISCO - All eyes on Wall Street are keenly focused on Smith Barney's novel plan to build a business unit around its top-producing advisers. Last month, when New York-based Smith Barney said that it...

Hanks' 'third act' film: From layoff to latte.(Short Interests)
April 10, 2006... Byline: Charles Paikert NEW YORK - The saga of employees who face life after a corporate layoff will soon be jumping from the headlines to the big screen. Tom Hanks is set to star in "How Starbucks Saved My Life,'' based on a book...

Small money managers face many headaches; Firm claims it has Rx for independence needs.(News)
April 10, 2006... Byline: David Hoffman NEW YORK - When an asset manager loses its independence, it becomes a concern for many financial advisers. Consider the $3.5 billion Clipper Fund, which is advised by Davis Selected Advisers LP of Tucson, Ariz....

Dividends to continue exploding onto scene.(Conference Call)
April 10, 2006... Byline: Aaron Siegel NEW YORK - What the 1990s meant for the growth and maturation of technology stocks, the present decade looks to hold the same potential for the emergence of the dividend. The public just doesn't know it yet. ...

At the Bell; Internet-based firm to target the wealthy.(Late News)
April 10, 2006... John Shields, a former Navigant Consulting Inc. managing director, has resigned from the Chicago company to launch an Internet-based financial advisory firm geared toward wealthy investors. The new company, OpenInvesting, will be based in...

New mutual fund's approach: No performance, no fee.(Street Wise)
April 10, 2006... Byline: Jeff Benjamin TFS Capital LLC in Richmond, Va., is bucking traditional money management by drawing attention to its management fee, or lack thereof. The nine-year-old boutique shop, which has $60 million under management in two...

Swaps into index annuities eyed; NASD planning `sweep' exams of broker-dealers.(News)
April 10, 2006... Byline: Sara Hansard WASHINGTON - NASD is switching gears on variable annuities. Instead of taking action against broker-dealers who sell unsuitable variable annuities, the organization is conducting a series of "sweep'' exams on...

Clients spur indies to add wealth management tools; LPL, Commonwealth, RJ among those emphasizing platforms, programs for reps.(News)
April 10, 2006... Byline: Bruce Kelly NEW YORK - Top independent-contractor broker-dealers are increasingly emphasizing wealth management platforms and programs for their affiliated advisers and registered representatives, particularly as advisers' baby...

More women exhibiting financial savvy.(Short Interests)
April 10, 2006... Byline: Aaron Siegel NEW YORK - Despite the numerous societal advances that women have made in the past few decades, there is still work to be done in terms of finances, according to a recent survey. An online survey conducted by Women...

Market-indexed CDs placed under the microscope; NYSE Regulation scrutinizes reps' sales of the hybrid products.(News)
April 17, 2006... Byline: Bruce Kelly NEW YORK - Regulators at NYSE Regulation Inc. are scrutinizing registered representatives' sales of market-indexed and market-linked certificates of deposit. Last month, NYSE Regulation issued a memo to its member...

Americans found illiterate in saving, investing; Congress designates April to spotlight educational need.(News)
April 17, 2006... Byline: Dan Jamieson IRVINE, Calif. - Congress thinks Americans fall short when it comes to saving and investing, and it has designated April as financial literacy month for the fourth straight year to spotlight the problem and to...

Extent of advisers' use of equity options is debated; S&P launches web service to make tool more accessible.(News)
April 17, 2006... Byline: David Hoffman NEW YORK - While few doubt that financial advisers are turning increasingly to equity options to boost - or at least protect - returns for clients, the extent to which options are becoming a common tool for advisers...

Lincoln looks to bolster national recruiting effort; Securities America veteran Flint joins firm.(News)
April 17, 2006... Byline: Bruce Kelly NEW YORK - After years of little or no national recruiting presence, Lincoln Financial Advisors Corp. has gone outside the firm to bolster its recruiting staff. Last Wednesday, Chris Flint, who had been senior vice...

At the Bell; Active fund managers, indexes split in 1Q.(Late News)
April 17, 2006... Actively managed mutual funds outperformed their relative Standard & Poor's indexes in five of 11 general equity categories during the first quarter, Standard & Poor's said Thursday. In one category, mid-cap-blend, active funds ended the...

Hedge fund managers to get back to the garden.(Short Interests)
April 17, 2006... Byline: Jeff Benjamin DETROIT - As if hedge fund managers didn't already enjoy rock-star-like status, the industry now has its own rock concert designed around a business conference - or it might be the other way around. Hedgestock...

Analyze this: Crash course pays off.(Short Interests)
April 17, 2006... Byline: Brooke Southall SAN FRANCISCO - It sometimes takes somebody else's money to make a passing grade in chartered financial analyst exams. Test takers who come up with $1,800 to attend a weeklong CFA exam immersion program at the...

Legg Mason getting a foot in the door.(Reverse Spin)
April 17, 2006... Byline: Frederick P. Gabriel Jr. It looks as if Legg Mason Inc. is about to get a real leg up on many of its competitors. Standard & Poor's in New York said Tuesday that the Baltimore money manager will soon replace Guidant Corp. in...

Closing Quote.(Quotes)
April 17, 2006... "Today, bigger is badder.'' Peter E. "Tony'' Guernsey Jr., president of Wilmington Trust FSB New York, on his belief that large banks are becoming too big for the taste of wealthy customers. Page 29

Fund pulls no punches in its allegiance to shareholders.(Street Wise)
April 17, 2006... Byline: Jeff Benjamin For a one-year-old mu-tual fund with no ticker symbol and just $5.6 million under management, the Free Enterprise Action Fund has managed to rattle some of Wall Street's sturdier cages. Two weeks ago, The Herald...

Insurers' bank marketing of term life diverges; Middle market, emerging affluent targeted.(News)
April 17, 2006... Byline: Gary S. Mogel NEW YORK - Two major life insurers are ramping up their marketing of term insurance through banks but are taking very different approaches, according to company executives. ING U.S. Financial Services in Atlanta...

GAO probe gets key lawmakers on preparers' case.(Tax Watch)
April 17, 2006... Byline: Mark Battersby The results of a congressional investigation have led two key senators to implicate the tax return preparation industry in widespread tax fraud and to question the overall level of preparers' competence. The...