Portfolio

Risk management will take on an increasingly important role this year as financial firms struggle to survive the fallout from last year's market mess.

Hedge fund managers have been beating mutual fund managers at scooping up initial public offerings in recent years, but given the weak performance of and loss of assets at hedge funds, their competitive advantage may be waning, The Wall Street Journal reports.

Large asset management mergers and acquisitions deals will likely occur this year, according to a report from Jefferies Putnam Lovell, as firms take advantage of distressed sales and divestitures.

The Federal Reserve has allowed more companies to take part in its program to add more liquidity to money market mutual funds.

Total assets of money market mutual funds increased by $54.67 billion to reach $3.895 trillion for the week ending January 7, according to the Investment Company Institute.

Assets held by American millionaires have declined 30% during the economic crisis, according to a November survey by Spectrem Group.

Fidelity Investments Canada has unveiled nine Fidelity Private Investment Pools aimed at the high-net-worth market. The offerings cover a wide array of asset classes and are said to be institutional-grade.

Hedge funds lost an average of 18.4% in 2008, according to early projections by the Hennessee Group. However, given that the Standard & Poor’s 500 Index declined 37% in 2008, hedge funds “significantly outperformed equity benchmarks on a relative basis,” said Hennessee Managing Principal Lee Hennessee.

The Investment Company Institute, along with the UK's Investment Management Association and Australia's Investment and Financial Services Association, has released a combined statement in support of prudent regulatory oversight of short selling.

After a surprisingly bad year, international funds—which sank an average of 45% in 2008—could be ripe for big gains later this year, some managers say.