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Morningstar Adds 10 Alternative Categories


Morningstar has added 10 alternative investment categories to its classification system, eight of which cover exchange-traded funds and two the broad universe of funds.

"We're adding these new categories because of the growing number and heightened use of alternative funds," said John Reckenthaler, vice president of research for Morningstar. "It's clear that alternative funds are here to stay. More than 400 alternative mutual funds and ETFs launched in the last five years, including more than 100 last year along. And investors poured almost $38 billion into these funds in 2010."

The two new broad universe categories are managed futures and multi-alternative.

The ETF categories are: volatility, leveraged commodities, inverse commodities, leveraged debt, inverse debt, leveraged equity, inverse equity and ETFs that mix leveraged and inverse strategies.

 

Financial Research Heads Via Single App Onto iPad

Markit and Deutsche Bank are providing financial research through a single application for iPad users.

The Markit Hub Financial Research app will give institutional investors simple, portable access to any research from Markit they are entitled to receive.

Deutsche Bank also will make its research available on the Markit platform. Additional research providers will be added, Markit said.

"As financial market participants use the iPad increasingly as part of their daily workflow, the Markit Hub iPad app will provide substantial benefits to the consumers and providers of institutional research, data and analytics," said Markit President Kevin Gould.

The Markit Hub app provides access to institutional research, data and analytics. Users are able to search content across providers and categories, create alerts, and save and annotate documents.

 

No. 1 Challenge is Getting Investors to Assume Risk

While investors have overwhelmingly stayed the course and remained invested in mutual funds following the financial crises of 1987, 1990, 2000 and 2008, the latest credit crisis has greatly reduced investors' risk tolerance, said Investment Company Institute Chairman Edward C. Bernard in his opening keynote address to the ICI's General Membership Meeting in Washington.

"The financial meltdown of 2007 and 2008 created sharp setbacks for investors," said Bernard, who is also vice chairman of T. Rowe Price.

"Across a wide spectrum of ages, investors have a reduced appetite for risk. Fewer investors say they'll take above-average or substantial risk in exchange for comparable returns. Among households owning mutual funds, the share willing to take such risks has fallen by almost one-fifth-from 37% to 30%-since 2008," Bernard said.MME

 

 

Quote of the Week

"The mutual fund industry has a very solid future. It weathered the financial crisis better than any other sector of financial services, and I believe it will continue to increase its market share."

- Mercer Bullard

President

Fund Democracy