Investment News articles from August 2008

Investment News archives from August 2008

New IRS rulings affect investors; Foreign holders of U.S. real estate and hedge funds are targets.(The Tax-Conscious Adviser)
August 4, 2008... Byline: Robert N. Gordon Three new revenue rulings released by the Internal Revenue Service over the past few weeks are likely to have substantial effects on investors. The first is Revenue Ruling 2008-31, which concerns foreign...

Taking a broad view of 'environmentally friendly'; There are many ideas about what makes an investment 'green'.(News)
August 4, 2008... Byline: Deborah Nason Demand for "green'' investing is growing, studies show, but opinions vary widely on what makes an investment green. Of the 15 largest environmentally oriented mutual funds offered in the United States, nine focus...

NexGen thinks charity.(Short Interests)
August 4, 2008... Byline: Aaron Siegel The Foundation of Financial Planning has created a fund to allow members of the Denver-based Financial Planning Association's NexGen group to make contributions to support charitable causes related to financial...

After the cheering, advice is needed; But many advisers are loath to take on Olympians as clients.(News)
August 4, 2008... Byline: Andrew Coen Athletes participating in this month's Summer Olympics will need financial advice once the torch goes out, but many advisers tend to ignore the opportunity to work with such clients. Uncertainty as to how Olympic...

Planning in China: Big opportunity, big challenges; Banks dominate a market where clients put a premium on safety.(News)
August 4, 2008... Byline: Charles Paikert The nascent market for financial planning in China has explosive potential, but don't expect a carbon copy of the American model - not yet, anyway. The Wild West nature of the country's rapidly emerging economy...

Don't know the score.(Short Interests)
August 4, 2008... Byline: Darla Mercado Americans know about credit scores, but the majority of consumers don't understand what their scores mean or how they work, according to a survey from the Consumer Federation of America and Washington Mutual Inc. of...

Advisers using separately managed accounts to tame bear; Strategies include use of alternatives and multiple managers.(News)
August 4, 2008... Byline: Darla Mercado Tax loss harvesting and defensive portfolios have been the way to go for financial advisers who rely on separately managed accounts - particularly during rocky equity markets. Clients aren't as jittery about the...

Advisers cheer Finra pilot on arbitration panels; But the test worries plaintiff's attorneys.(News)
August 4, 2008... Byline: Sara Hansard Many advisers who have been involved in arbitration cases are welcoming a move to give investors the option of having all-public arbitration panels. But plaintiff's attorneys fear that the pilot program, announced...

Housing law cracks down on loan originators; New rules could boost industry's battered image.(News)
August 4, 2008... Byline: Janet Morrissey The long-awaited housing bailout bill, which President Bush signed into law last week, takes a bold step toward clamping down on fraud and abuse in the troubled mortgage industry by mandating that all loan...

A wake-up call for planners fresh out of college.(News)
August 4, 2008... Byline: Aaron Siegel Many recent college graduates have found that adapting to the day-to-day rigors of working in a financial planning firm can be a stark change from their experiences in the classroom. Handling the responsibilities...

Young planners sitting pretty, Tibergien says; Demand is growing as talent pool shrinks, operational costs grow.(News)
August 4, 2008... Byline: Aaron Siegel With operational costs growing and financial advisers in short supply, the demand for talent has put the value of young financial planners at a premium, according to industry guru Mark Tibergien. In the meantime,...

Kudos to Merrill, Lone Star on their deal.(Viewpoint)
August 4, 2008... MerriLl lynch & Co. Inc.'s actions last week may well have marked the beginning of the end of the financial crisis that has gripped the economy for more than a year. New York-based Merrill capitulated, accepted that mortgage-related asset...

Ladenburg Thalmann eyeing more indie firms; At least three B-Ds reportedly in its sights.(News)
August 4, 2008... Byline: Bruce Kelly Ladenburg Thalmann Financial Services Inc., about to close its second acquisition of an independent broker-dealer since last fall, is gunning for more. The Ladenburg official working the phones, Scott Sherwood,...

Advisers see opportunity in private loans, mortgages; Providing help for those with 'decent credit'.(News)
August 4, 2008... Byline: Jeff Benjamin As fallout from the mortgage crisis leads to tighter restrictions on lending, some financial advisers are finding opportunities to fill a void for their clients by entering the lending business. "Credit is tight,...

Name the best retirement income tools.(News)
August 4, 2008... Which product companies' print and new-media materials related to retirement income are the most useful? Those whose brochures, white papers, original research, webcasts, podcasts, CDs or targeted websites help you most are eligible to earn the...

This ain't your father's index fund; Direxion's new commodities offering can go long or short in six sectors.(Street Wise)
August 4, 2008... Byline: Jeff Benjamin If there is an upside to rising energy prices, it might be the increased awareness among consumers and retail investors of commodities and the effect they can have on the economy. It is this newfound awareness...

Advisers help retirees spend or save wisely.(Short Interests)
August 4, 2008... Byline: Lisa Shidler Just 22% of American retirees said they worked with a financial adviser within the first two years of their retirement, according to a new survey from Thrivent Financial for Lutherans. But of those who worked with...

Critics seize upon Vanguard's handling of U.S. Growth Fund; Chairman chastises unhappy investor in letter.(News)
August 4, 2008... Byline: David Hoffman The Vanguard Group Inc.'s handling of its lackluster U.S. Growth Fund threatens to tarnish the company's reputation for putting investors first. First, there was an angry letter that John Brennan, chairman and...

Retirement income divides advisers; They split 54-46 between approaches that favor total return, targeted-investment pools.(News)
August 4, 2008... Byline: Lisa Shidler Although they typically use the same investment products to build retirement portfolios, financial advisers are almost evenly split as to the best way to manage retirement income distributions from these assets. ...

IN events.(Short Interests)
August 4, 2008... Retirement Income Communications Awards Sponsored by InvestmentNews and the Retirement Income Industry Association, these awards recognize the best in printed and new-media materials aimed at helping financial advisers better prepare their...

The week ahead.(Short Interests)(Calendar)
August 4, 2008... Aug. 4 The Challenger Job-Cut Report for July is scheduled to be released at 7:30 a.m. ET. Personal-outlays-and-income data for June are slated for release at 8:30 a.m. ET. Aug. 5 The Federal Open Market Committee at 2:15...

At the bell.
August 4, 2008... Study: Advisory firms are in buying mode In the past two years, 53% of registered investment advisers bought or considered buying another advisory firm, according to a new study from Pershing Advisors LLC. The Jersey City, N.J., firm...

Keeping clients calm and focused.(Viewpoint)
August 4, 2008... Financial planners and investment advisers appear to be earning their fees. A survey by the Washington-based Center for Audit Quality found that investors haven't panicked in the face of the financial crisis and the resulting bear market....

Senate may pass narrow insurance reform; Federal charter option remains a concept that lacks broad support.(News)
August 4, 2008... Byline: Sara Hansard The Senate Banking Committee appears likely to act on legislation that would set up a uniform approach to regulating the commercial-surplus-lines insurance market. Surplus lines insurance consists primarily of...

American to introduce international fund; New equity offering seeks to generate income and growth.(News)
August 4, 2008... Byline: Sue Asci For the first time in almost a decade, American Funds plans to launch a new equity fund. The fund, American Funds International Growth and Income, fills a void in the group's lineup and reflects changes in the global...

Finra proposes tougher sales rules on variable products; Regulation would require clearer labeling.(News)
August 4, 2008... Byline: Darla Mercado A proposed rule from the securities industry's self-regulatory organization would impose greater consumer protections on marketing materials for variable-insurance products, though some critics have raised questions...

Outsourcing is the answer for small firms, some say; Letting others handle advisers' day-to-day tasks cuts expenses and frees up time for clients.(Tech Update)
August 4, 2008... Byline: Davis D. Janowski Some financial advisers are finding that outsourcing most of their day-to-day tasks, including many administrative duties, saves time and is cost-effective. Russ Thornton, a fee-only registered investment...

Make clients' data meaningful; Adopting an 'information under management' approach can add value to your services.(Practice Management)
August 4, 2008... Byline: Edmond Walters If you were around in the 1960s, you probably remember feeling that Woodstock changed everything. It was unique and legendary. Our world seemed to tilt on its axis, and everyone approached things a little...

Nouriel Roubini; Bear sees worst crisis since Great Depression.(Newsmakers)
August 4, 2008... Byline: Janet Morrissey Brace yourself. Nouriel Roubini, whose gloom-and-doom predictions about the housing market collapse and subprime-mortgage debacle have come true, is getting even more bearish. During an interview late last...

Correction.(Correction notice)
August 4, 2008... In the list of U.S. clearing firms ranked by broker-dealer clients which appeared in the July 28 issue, the correct contact information for Legent Clearing LLC of Omaha, Neb., is Ray Maratea, co-president, at ray.maratea@legentclearing .com.

U.S. clearing firms ranked by broker-dealer clients.(Special Report: Clearing Firms)
August 4, 2008... ***** Correction: In the list of U.S. clearing firms ranked by broker-dealer clients which appeared in the July 28 issue, the correct contact information for Legent Clearing LLC of Omaha, Neb., is Ray Maratea, co-president, at...

Clearing firms used by the top independent broker-dealers.(Special Report: Clearing Firms)
August 4, 2008... Rank/Broker-dealer/Clearing firm 1. LPL Financial/Self-clearing Associated Securities Corp./Pershing LLC Mutual Service Corp./Pershing LLC Waterstone Financial Group/Pershing LLC, Mesirow Financial 2. AIG Advisor Group ...

Take a closer look at clients' art collections; Valuable estate class is sometimes overlooked.(News)
August 11, 2008... Byline: Charles Paikert Financial advisers need to pay more attention to their clients' art collections, according to experts who are trying to bring the art and financial worlds closer together. "Most advisers don't have art assets on...

Investor access to commodities threatened; Trade organizations rally against proposed tighter limits on futures.(News)
August 11, 2008... Byline: Dan Jamieson Industry trade groups have entered the debate over congressional proposals that could restrict investors' access to products that invest in commodities or track commodity indexes. Of particular concern to the...

Hedge funds alone in fight against short-selling curb; SEC expected to shore up protective measure.(News)
August 11, 2008... Byline: Sara Hansard The hedge fund industry faces growing opposition to its efforts to hold back restrictions on naked short selling. Among the 300 investor comments filed over the past month with the Securities and Exchange...

First, do no intentional harm; Promoting fiduciary responsibility would encourage investor-friendly behavior from the start.(Fiduciary Corner)
August 11, 2008... Byline: Blaine Aikin Providing financial advice is similar to providing medical advice in that there is inherent uncertainty about whether recommended actions will achieve the desired results. In medicine, the term "iatrogenic injury''...

Advisers urge clients to prepare for potential layoffs; Cash reserve to cover 3 to 6 months' expenses is recommended.(News)
August 11, 2008... Byline: Darla Mercado As layoffs rise, some financial advisers are encouraging their clients to come up with contingency plans in case they lose their jobs. "I don't care how old you are; obviously, losing your job is a problem if you...

Junk funds pique investor interest; Hunt for yield seen making them desirable despite poor returns.(News)
August 11, 2008... Byline: David Hoffman Junk bond funds are beginning to look more attractive to investors, even though their returns haven't been impressive. For the week ended July 30, high-yield-bond funds reported $153.2 million of net inflows,...

U.S. stock market luring investors; Exposure to the sector has been on the increase.(News)
August 11, 2008... Byline: David Hoffman The U.S. stock market is outperforming the global stock market for the first time this decade, with asset managers adjusting their portfolios to take advantage of the trend. "Our emerging market exposure has come...

The right role for international stocks; Why it makes sense for a retirement portfolio to be diversified globally.(Retirement Watch)
August 11, 2008... Byline: Vladimir Milev Over the past six years, international stocks - those of companies from both developed countries and emerging markets - have outperformed U.S. stocks by a wide margin. Many investors, including those saving for...

DAVID DEVOE; 2008 may end well for RIA deals, he says.(News)
August 11, 2008... Byline: Charles Paikert When talks about mergers and acquisitions among RIA firms, advisers pay attention. A few months ago, Mr. DeVoe, director of M&A for Schwab Institutional of San Francisco, drew a packed house at a New York hotel when...

Americans under 35 piling up debts; Three-quarters owe as much, or more, than last year.(News)
August 11, 2008... Byline: Andrew Coen A new study reveals that financial problems are getting worse for Americans under 35. About three out of four are in as much or more credit-card debt this year as last, with slightly more than half making minimum...

Stanford tees up Stenson.(Short Interests)
August 11, 2008... Byline: Andrew Coen Stanford Financial Group continued its alliance with professional golf with its signing last week of top five European golfer Henrik Stenson to help brand the wealth management company around the globe. Mr. Stenson,...

New fiduciary language challenges risk management issues; Other Voices.(Viewpoint)
August 11, 2008... Byline: Joseph W. Maczuga Debate over new fiduciary language from the CFP Board and the FPA has focused on the risk management aspects of life insurance, though some of the conclusions have gone unchallenged, and others reflect industry...

Uncorking a new asset class; Some argue their investment status, but fine wines are continuing spirited rise.(News)
August 11, 2008... Byline: Jeff Benjamin The practice of fine wine investing, which has appealed to wealthy and sophisticated collectors for ages, is coming out of the cellar and could emerge as a legitimate alternative-asset class. While some financial...

Keeping an eye on cash flow; Whatever the investments you choose for your clients, be sure the cash keeps flowing.(Investment Strategies)
August 11, 2008... Byline: Brett Wilder Advisers have a fiduciary responsibility to educate their clients that generating enough cash to fund lifetime goals and objectives adequately is the key to financial success. While maximizing returns is desirable,...

Variable's loss is fixed's gain; Investors seek the stability of fixed annuities.(News)
August 11, 2008... Byline: Darla Mercado Because of slumping second-quarter sales of variable annuities, industry observers believe fixed annuities could benefit. "In our last set of data, we were seeing an explosion on the fixed side - more than we have...

Planners will get VA fund debate at meeting; FPA's annual conference is expected to draw record 5,000 attendees.(News)
August 11, 2008... Byline: Aaron Siegel A debate between an advocate of mutual funds and a proponent of variable annuities could set off fireworks at this year's annual conference of the Financial Planning Association. Fund fan Harold Evensky, a...

Morgan Stanley Investment Management looks beyond U.S. But money manager faces formidable obstacles in its quest to bring back revenue.(News)
August 11, 2008... Byline: Thao Hua Morgan Stanley Investment Management is counting on overseas growth to help get it back on track as revenue continues to fall. But the hurdles are high, particularly in Europe, where unfavorable market conditions in...

Investors go for gold in garbage; Investment strategies in waste management include recycling, energy.(News)
August 11, 2008... Byline: Thao Hua One person's trash is another's alpha. Investment strategies in waste management - including trash collection, separation, disposal and recycling - are gaining institutional interest as landfills globally are reaching...

A real pain in the portfolio; Just Thinking.(Viewpoint)
August 11, 2008... Byline: Jim Pavia Looking at my investments lately is a lot like watching a train wreck - I know I should avert my eyes, but I just can't make myself stop peeking. Lately, I have had to do more than peek. My son starts college in two...

Analysts shrug off Street's proposals on systemic risk; Properly assessing counterparties should always be a priority, experts say.(News)
August 11, 2008... Byline: Sara Hansard A report issued last week by financial industry leaders calling for greater private initiatives in containing systemic risk was greeted by some analysts as being a "no-brainer.'' "Changing rules in assessing your...

IN events.(Short Interests)
August 11, 2008... Sept. 9 Community Leadership Awards Dinner Celebrate advisers who are making a difference in their community. Award honorees will be announced during the dinner. The Invest in Others Charitable Foundation will make a donation of $10,000 to...

REIT converts offer opportunity amid volatile market; Some selling at discount can be redeemed for full face value.(News)
August 11, 2008... Byline: Janet Morrissey Investors, jittery about investing in volatile REIT stocks during the economic downturn and credit crunch, might look a little deeper into the group's capital structure for the right pick - in particular, real...

Portfolio management tool may come to the iPhone; Lab49 introduces enterprisewide software for the new Apple handheld.(News)
August 11, 2008... Byline: Davis D. Janowski Professional-grade financial services applications may soon be coming to the iPhone. Lab49, a consulting firm based in New York and London that specializes in designing advanced interfaces for the capital...

Newbridge reps said to be eyeing the exits; Regulatory woes, clearing firm change cited.(News)
August 11, 2008... Byline: Bruce Kelly A combination of legal problems and issues around its platform are pushing some representatives that are affiliated with Newbridge Securities Corp. of Fort Lauderdale, Fla., to look around at other broker-dealers,...

Energized by energy.(Short Interests)
August 11, 2008... Byline: Aaron Siegel Even though energy prices have fallen in recent weeks and shares of financial services firms have been on the decline for much longer, traders are seeing investment opportunities in those sectors, according to a survey...

Recent quarter gives REIT investors vacant feeling; Trusts miss targets or ratchet down their expectations.(News)
August 11, 2008... Byline: Janet Morrissey The deteriorating economy and deepening credit crisis are starting to take a toll on the commercial-real-estate market as a number of real estate investment trusts have either fallen short of Wall Street's...

Women fear retirement more than men; Inflation, health, outliving money top worries, study shows.(News)(Report)
August 11, 2008... Byline: Lisa Shidler Women are more worried about retirement than men are, and their top concerns are inflation, their health and outliving their money, a recent study found. The report, from The Hartford (Conn.) Financial Services...

Employers make it easier to participate in 401(k)s; Automatic enrollment, step-up increases become more frequent.(News)
August 11, 2008... Byline: Lisa Shidler Employers are getting more proactive about offering incentives to make it easier for employees to use a 401(k) plan, according to a study from Deloitte Consulting LLP. According to the New York-based company's...

Securities America itches to make more acquisitions; On the heels of latest deal, firm's CEO sees 'lots of opportunity'.(News)
August 11, 2008... Byline: Bruce Kelly Securities America Inc. has made a splash in the roiling mergers and acquisitions market for independent broker-dealers, and it could make more waves soon. The independent-broker-dealer subsidiary of Ameriprise...

The week ahead.(Short Interests)(Calendar)
August 11, 2008... Aug. 11 The Federal Reserve Bank of Chicago's summer workshops on money, banking and payments begins and runs through Aug. 22. Aug. 12 International-trade-balance figures for June will be released at 8:30 a.m. ET. The...

People.
August 11, 2008... Penn Mutual Life Insurance Co. of Horsham, Pa., has hired Richard J. DeCarolis, 47, as vice president and controller. Previously, he was chief financial officer for HTH Worldwide in Radnor, Pa. AXA Equitable Life Insurance Co. of New...

LETTERS.(Viewpoint)
August 11, 2008... Annuities are complex any way you slice it I am writing in reference to Evan Cooper's June 4 online opINion column, "A VA rider or a venti.'' If only it were that simple. As a Starbucks fan, I enjoyed the analogy. However, there...

SEC spots ethics lapses.(Short Interests)
August 11, 2008... Byline: Sara Hansard Incomplete codes of ethics and codes of ethics that aren't followed were cited as two common problems found by Securities and Exchange Commission examiners at investment advisory firms. The SEC's office of...

SEC study: Prospectuses go largely unread; Commission reopens comment period on 'summary' version.(News)
August 11, 2008... Byline: Sara Hansard A recently released SEC study provides further evidence that mutual fund prospectuses need fixing. Nearly two-thirds of investors who received mutual fund prospectuses said they rarely, very rarely or never read...

Light at the end of the interest rate tunnel? Invesco bond executive sees positive signs in the market.(News)
August 11, 2008... Byline: Sue Asci The bond market is in for more volatility, but a turnaround could start to emerge in the next six months, according to the head of Invesco Ltd.'s worldwide fixed-income division. Karen Dunn Kelley, who recently...

Regulation will improve the health of real estate market.(Viewpoint)
August 11, 2008... The best part of the housing bill signed by President Bush on July 30 was the section that establishes new regulations for mortgage loan originators. The regulations require all mortgage originators to be screened, educated, tested and...

Deals cut on ARS take heat off brokers, advisers; Citigroup, Merrill, UBS agreements places burden squarely on the firms, some say.(News)
August 11, 2008... Byline: Bruce Kelly When Citigroup Inc., Merrill Lynch & Co. Inc. and UBS AG agreed last week to buy back an astounding $36.7 billion of moribund auction rate securities from their wealthy clients, the firms relieved their brokers and...

Weighing in on paying off mortgages; Advisers are split on whether it's wise to end burden early.(News)
August 11, 2008... Byline: Janet Morrissey It used to be the American dream to crack open a bottle of champagne and burn the mortgage the moment a homeowner paid off their house in full before settling into retirement. However, that mind-set may be more...

American family offices eye Europe; Rockefeller & Co. may open branches in London and Switzerland.(News)
August 11, 2008... Byline: Charles Paikert American multifamily offices are beginning to venture into the lucrative European wealth market, but the unanswered question is whether the invasion will be welcomed or shunned. According to a new report by...

At the bell.
August 11, 2008... Wachovia ordered to pay $5.3M award In a case involving allegedly stolen stock, Wachovia Securities LLC was hammered in a recent arbitration loss and ordered to pay clients $5.3 million in damages. The case, decided July 30 and first...

Fund is long on short-selling expertise; Palantir offering aims to win in all types of markets.(Street Wise)
August 11, 2008... Byline: Jeff Benjamin At a time when many flagship funds are struggling under the weight of the beaten-down financial sector, a fund like the $35 million Palantir Fund (PALIX) seems particularly nimble. The ability to invest globally...

Prime numbers.
August 11, 2008... Go figure $1.504: The value of the euro in U.S. dollars on Aug. 8, the lowest it has been since Feb. 27. Sources: XE.com, Bloomberg $3.836: The national average price per gallon of regular unleaded gas on Aug. 8, down 7% from the...

Correction.(Correction notice)
August 11, 2008... In an article in the July 28 issue, "Housing mess spawns more mortgage fraud,'' Jay Foley's affiliation was incorrect. He is the executive director of the Identity Theft Resource Center in San Diego.

SMAs ranked by second-quarter returns.(Separate Accounts)
August 11, 2008... Byline: Gib Watson Second-quarter commentary by Gib Watson DOMESTIC EQUITY Of the nine major Russell style indexes, only three were negative for the second quarter, and both the mid-cap-growth and small-cap-growth indexes were up...

Website gives drill-down information on potential advisers; ClaroConnect.com gives clients details on pros' specialties.(Tech Update)(Website overview)
August 18, 2008... Byline: Davis D. Janowski Scott Barkow, an adviser with Raymond James & Associates Inc. of St. Petersburg, Fla., isn't happy about the challenging economy and how it could hurt new business. While word of mouth has helped him build his...

Meeting for productivity's sake; Getting your team together to plan the week helps them perform more consistently.(Practice Management)
August 18, 2008... Byline: Paul Rubacka Most financial advisers consider themselves visionaries. Their talent and success in financial planning stems from an ability to envision their clients' future and the investments needed to get there. As their...

LETTERS.(Viewpoint)
August 18, 2008... Beware of new breed of auction rate securities Aside from equating money funds to broccoli, I enjoyed Evan Cooper's opINion column on auction rate securities that ran on investmentnews.com Aug. 6. Well stated. Recently, my wife sauteed...

Funds of hedge funds losing their luster; As performances slow, some are questioning extra fees and lack of differentiation.(News)
August 18, 2008... Byline: Jeff Benjamin Funds of hedge funds, after enjoying steady growth since the beginning of the decade, are now seen by some in the industry as victims of their own success. As performance has leveled off throughout the hedge fund...

Ameriprise plan: Rouse H&R Block brokerage unit; For $315 million, new owner gets 900 advisers and $30 billion in client assets.(News)
August 18, 2008... Byline: Bruce Kelly Ameriprise Financial Inc. believes it can spiff up its acquisition of H&R Block Financial Advisors Inc., which never lived up to its potential as a dominant national brand. "I think they only got part of the way...

Are young planners too green? NexGen leader says they lack communication skills.(News)
August 18, 2008... Byline: Aaron Siegel Despite their academic training, college graduates from financial planning programs need real-world experience in order to be effective with advisory firm clients, according to Michael Kitces, a founder of the...

Prime numbers.
August 18, 2008... Go figure 15%: The estimated percentage of U.S. Internet users who access the web using dial-up rather than broadband connections. Source: Communications Workers of America 55%: The percentage of The Bear Stearns Cos. Inc.'s 14,000...

Lessons learned from auction rate securities; Editorial.(Viewpoint)(Editorial)
August 18, 2008... Whether done voluntarily, as in the case of Merrill Lynch, or as the result of settlements with regulators, as with Citigroup, JPMorgan Chase, Morgan Stanley, UBS and Wachovia, the buy-backs of failed auction rate securities that giant Wall...