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News

Fidelity to Reshuffle Staff in Four Locations

Roughly 1,000 employees will be moved to Boston and Smithfield, R.I.

Revenue-Sharing Fees Inconsistent in 401(k)s

Some funds have high revenue-sharing fees, while others have none at all.

Fund Giants Resist ‘Radical Changes’ to Money Funds

But most agree with SEC proposals to make them safer.

Hancock Arms Advisers With Portfolio Insight Tool

Program enables advisers to create detailed reports of client portfolios.

Supreme Court Might Side With Investors on ‘Excessive Fees’

Initial filing briefs, including one from the SEC, indicate retail investors might enjoy a long-awaited victory.

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Articles

Providers Look for Auto Rollover Solutions to Include Job Changers

WASHINGTON - With 47% of 401(k) plans now using automatic enrollment, the programs have helped get millions of new workers enrolled to start saving early for retirement, but industry experts say the automatic nature of these plans needs to extend to helping 'hands-off' investors when they change jobs. When an employee leaves a job, he or she can choose to roll over their money into an individual retirement account (IRA), take a lump-sum payment minus taxes and a 10% penalty, or do nothing and leave their money in the 401(k). Sir Isaac Newton would predict the latter.

Securities Lending to Begin Letting the Sunshine In

NEW YORK - Investors tend to stay quiet about financial products they don't understand as long as the profits keep coming in, but when the tide goes out and profits fall, they want answers. After several profitable decades of operating largely in the shadows, securities lending is undergoing some major changes-along with virtually every other financial market in the world-that will drastically increase price transparency, and those markets and instruments that can adapt to these changes will survive and prosper, lending experts say.

Flexibilty Key as Firms Reevaluate Risk Structure

Before the bottom fell out of the markets last year, most asset management firms thought they already had robust risk management processes in place. Now they're not so sure. As firms rethink risk, experts say they should focus more on having a flexible program in place rather than on planning for every possible contingency.

Give Fund Managers Back The Power to Pick Stocks And Spot Macro Trends

Finally, insiders launched candid criticism at the mutual fund industry last week, to help it respond sensibly to the economic meltdown and reposition itself to regain investor trust. Foremost among this advice is giving portfolio managers back the power to pick stocks and run with their investment ideas, instead of being so tightly tethered to an investment class and market capitalization. Further, fund managers should step away from their style boxes and take a look at bigger economic trends. The signs were all there, beginning with the 2007 demise of Bear Stearns' credit derivatives-laden hedge funds. Anyone could have foreseen the accelerating problems of the credit and capital markets, mutual fund managers among them. Had more of them moved into cash or safe investments, they would have avoided the across-the-board losses in 2008.

Funds Must Reassess Back-Office Controls

Thanks to shady money managers like Bernie Madoff who ruined it for everyone, the lucrative and surreptitious heydays of hedge funds may be gone for good. Tenacious regulators and spurned investors alike are demanding more transparency of their investment holdings, and hedge fund and mutual fund companies alike will need to beef up their back offices to meet this new demand.

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