Portfolio

83% of Fund Managers Expect Earnings To Increase Sharply in Third Quarter

Stunned by trillions of dollars of losses in the financial crisis, Americans will be investing significantly less in the future, according to a new survey by AlixPartners. Forty-nine percent of the 1,000 people the consulting firm surveyed have either stopped or reduced investing in stocks or mutual funds, 26% have no intention to return to these bedrock financial vehicles in the next three years, and another 27% were unsure whether they had the endurance to return to the markets in that timeframe.

Financial advisers generally prefer to manage a small number of high-net-worth clients rather than a large number of small accounts, but recent advances in automation technology could change this dynamic.

Though Bank of New York Mellon Corp.'s wealth management revenue has slumped, the unit's head is touting its resilience and plotting an aggressive strategy through mergers and acquisitions.

Many financial service companies were only able to survive last year's recession by slashing staff and utilizing automated technology solutions to support customers, advisers, salespeople and their remaining workers.

Minneapolis-based Allianz Life Insurance Co. of North America has beaten a class action lawsuit in court. A federal jury ruled against the plaintiffs in the case, Mooney v. Allianz Life Insurance Co.

State Street Corp. has added portfolio construction tools to its web-based hedge fund-of-fund platform, AlphaFrontier, which also includes custody, fund accounting, cash management, registration, risk services, investor services and credit.

To prevent other target-date investors from being burned as so many were in 2008, when the average 2010 and 2015 fund lost 25% of its value or more, more advisers are telling their clients that they need to look closely at the asset allocation and glidepaths of these funds so that half of their portfolios are not exposed to stocks on the eve of their retirement.

The Securities and Exchange Commission has issued a Wells notice to Charles Schwab informing the company it plans to sue it over two bond funds that held mortgage securities since the company marketed the funds as safe, high-yielding alternatives to money market funds.

The Securities and Exchange Commission has tapped Adam Storch to be the managing executive of the newly created Division of Enforcement.