Money Management Executive Latest News

Score one for fixed income mutual fund back-office operations teams.Having received final approval from the Securities and Exchange Commission last month, the Fixed Income Clearing Corp. (FICC) will now permit buy-side firms, including mutual funds and other registered investment institutions, to join as sponsored members on a limited basis - a first for any Depository Trust & Clearing Corp. (DTCC) subsidiary.

Canadian fund giant CI Fund Management has unveiled its plan to acquire troubled Amvescap, parent to the AIM Funds and the former Invesco Funds, for $7 billion in cash, the Globe and Mail reported last week.

With the popularity of hedge funds on the rise, many retail investors may be interested in cashing in on the same kind of strategies in the more familiar format of mutual funds, but such funds have floundered. Among 29 mutual funds listed in Bloomberg that are in a market-neutral category, average return has been only 2.4% over the past three years ending June 24, said Bloomberg News columnist Chet Currier. Average stock funds posted 10.9% over the same period.

By a narrow margin, actively managed large-cap mutual funds on average bested the S&P 500 during the first half of 2005, according to Standard & Poor's. The defeat was far from resounding, with only 52.5% of such funds topping the index.

At the end of September, investors in Vanguard Group's mutual funds will no longer be able to buy shares of funds they had sold within the previous 60 days by phone or Internet. Instead, investors can send in a check by mail, the Associated Press reports.

American Express Financial Advisors (AEFA) has reached a settlement with the New Hampshire Bureau of Securities Regulation regarding undisclosed conflicts of interest in mutual fund sales between January 1999 and March 2003. The company has agreed to pay total fines, penalties, reimbursement and restitution of $7.4 million, which includes $5 million in state fines and penalties, up to $2 million in restitution to New Hampshire investors, and reimbursement of $375,000 for the cost of the investigation.

More banks are certain to be on the hook, following the announcement of Bank of America's settlement with the Massachusetts Securities Division. Most recently, Citizens Financial Group has raised the division's hackles by failing to produce subpoenaed employee e-mails, originally requested in mid-February that was to have been fulfilled by early March.

Bank of America and Massachusetts regulators reached an agreement yesterday related to the Charlotte, N.C.-based bank's variable annuities sales practices.

A recent survey of 30 financial journalists revealed that the media views hedge fund managers as much more savvy about the markets than their mutual fund counterparts, with every respondent agreeing on that point.

Timing and patience are the keys to boosting mutual-fund returns according to a new study from Morningstar Inc.