Alternative investments

At the hearing on target-date funds that the Department of Labor and the Securities and Exchange Commission held in Washington last Thursday, the focus was on better disclosure of holdings.

WASHINGTON - Many investment industry leaders are worried that the proposed 401(k) fee disclosure regulations currently being pushed through Congress will actually increase the fees investors pay and increase their confusion.

After active managers fell in lockstep with their benchmarks and all of the major indexes in 2008, many institutional investors are paring back their investments with active managers in favor of low-cost passive alternatives, The Wall Street Journal reports.

After having raised only $500 million in the past two years, Fidelity Equity Partners, a private equity subsidiary, will be closed next month.

With Putnam Investments, Legg Mason and Invesco AIM recently rolling out absolute-return funds that promise an upside regardless of the market’s condition, some wonder if that is possible.

High-net-worth investors are reordering their priorities when selecting investment providers, according to “New Horizon, New Behavior,” a study of 2,100 investors released by Barclays Wealth.

Although there have been reports of one-third of employers cutting back on or eliminating 401(k) matches, for the most part, they have continued to add other features to the plans to increase participation and investment rates, Charles Schwab found. And that has helped most workers stay the retirement savings course.

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.

A recent cartoon in The New Yorker surely sums up many retirement investors' feelings toward their financial advisers: It depicts them being sacrificed to a volcano.

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.

ALPS Fund Services is planning to offer five commodity equity exchange-traded funds. They are: Agricultural Producers ETF, Energy Producers ETF, Industrial Metals Products ETF, Precious Metals Products ETF and Commodity Producers Composite ETF.

Grail Advisors is planning to offer four actively managed exchange-traded funds that will the first to use a single-manager approach.

IndexIQ has introduced an exchange-traded fund that will seek to replicate global macro and emerging markets hedge fund strategies.

Fidelity Investments and Kohlberg Kravis Roberts jointly announced Monday that the two firms have struck an agreement whereby the Boston-based mutual fund company's customers will be to access the initial public offerings and secondary stock sales of KKR portfolio companies.

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.

From recommending different products to rethinking their risk management strategy, some financial advisers say they have changed their approach in the wake of last year's market slump. Indeed, many retail investors remain on the sidelines of the stock market, with assets in equity funds only half of what they were in late 2007 before the economic crisis began and the market lost 56% of its value.

ProFunds Group has launched four leveraged international exchange-traded funds that will track the Europe, Australasia and Far East region, emerging markets, China and Japan. The funds will aim to return twice the daily performance of indexes tracking those regions.

After so many 2010 target-date funds came up short last year, Prudential Retirement investigated how they might be improved, and decided that including retirement income guarantees would be a key benefit. They would freeze the asset allocations of target-date funds five or 10 years prior to retirement, in exchange for guaranteed income.

Invesco, manager of the Aim and PowerShares families of mutual funds, has launched the Aim Balanced-Risk Allocation Fund, an international balanced fund. Via derivatives, it will invest 60% of its assets in fixed income, 20% in equities and 20% in commodities.

In a challenge to one of mutual funds' strongholds, exchange-traded fund providers are targeting defined contribution plans.