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Week In Review

47% of Asset Managers Expect to Expand Product Management Staff

Asset managers evidently are optimistic about renewed growth in assets under management, with 47% saying they plan to expand their full-time product management staff over the next 12 months, FUSE Research Network found in surveys conducted over the past two months. However, since 80% laid off staff over the past year, employment levels are not likely to return to pre-crisis levels anytime soon.

Another 7% plan to add freelance contractors, and 13% said they might lay off additional staff in 2010.

"Clearly, most firms have completed their business rationalization and are now strategically adding to staff," said Michael Evans, president of FUSE Research. "We believe product management is an underserved function at asset managers. Many firms recognize this and are adding incremental resources to staff."

Evans noted how critical it is to have robust product management teams as the economy begins to recover and investors once again become enthusiastic about the markets and fund offerings, saying, "Understaffing the product function at an asset manager will compromise the group's ability to effectively do their job" and create innovative offerings.

18% Plan to Save More

Sensing that the recession is nearing an end but that the recovery will be a long road ahead, Americans are planning drastic changes to the way they approach money, saving and investing, with 18% planning to save more, Country Financial found in a survey of 3,000 people.

Sixty one percent said they have been adversely affected by the recession, yet 48% said their family has coped with the economic downturn excellently or well. Still, 52% of this group said it will take at least two years for their financial situation to recover.

Twenty-eight said they have had to find additional sources of income to help pay bills, be it through a second job (30% of this group) or with their spouse returning to work (14%).

Looking ahead, 25% said they will be less reliant on credit and debt, 21% plan to continue sticking to a strict budget, and 18% plan on saving and investing more.

"Americans are incredibly resilient, and it's encouraging to see people are really trying to change," said Keith Brannan, vice president of financial security planning at Country Financial. "Making permanent, positive changes in how we all handle our money will make a big difference in achieving long-term financial security. Despite the financial setbacks that may have been outside of our control, most families can still build a financially secure future for themselves with proper planning.

"While many think it will take several years to get back on track after the recession, with time and discipline, most can achieve their financial security goals," Brannan added.

Long-Term Funds Take in $357 Billion Year-to-Date

Long-term mutual funds enjoyed their 35th straight week of inflows, totaling $8.42 billion for the week ended Nov. 11, according to the Investment Company Institute. Year-to-date, equity, fixed income and hybrid fund sales now total $357 billion.

In the latest week, stock funds experienced $1.24 billion in outflows, down from the $4.78 billion they lost the week before. Continuing a trend for 2009, investors redeemed $2.7 billion from U.S. stock funds and placed $1.46 billion into foreign stock funds.

Bond funds continued to be popular with investors, taking in $8.88 billion, up from $7.5 billion the previous week. Hybrid funds netted $782 million, more than double the previous week. Assets in money market funds continued their decline, losing $8.01 billion in the latest week, according to iMoneyNet. 

PIMCO Creates Enhanced Short Maturity ETF

PIMCO has launched an actively managed exchange-traded fund, the Enhanced Short Maturity Strategy Fund, to help cash investors earn better yields than the near zero percent money market funds now offer.

Jerome Schneider, deputy head of PIMCO's money market desk, will manage the fund. Employing strict risk controls to preserve capital and offering ready liquidity and transparency of holdings, the fund will invest in high-quality short-term investments, as money market funds do, but also expand its horizons by investing in longer maturity bonds and investment-grade fixed income.

In making these investment, the fund will take both a top-down and bottom-up approach.

Wealthy Still Skeptical of Economic Rebound, Stocks

Only 6% of wealthy investors with $500,000 or more in investable assets characterize themselves as enthusiastic about investing, while a full 49% are either reluctant or tentative about returning to the market, PNC Wealth Management found in its sixth annual Wealth and Values Investors' Outlook survey of 1,046 investors.

However, affluent investors were evenly split on their outlook for an economic rebound, with 40% expecting the economy to remain stagnant for another full year, and 51% anticipating improvement within the next six months. Among the ultra-wealthy, the outlook is slightly dourer, with 52% foreseeing the economy remaining stagnant for another year.