Money Management Executive Latest News

Money managers, mostly small ones, have been registering Internet fund products with the SEC at a rapid rate.

If the recent trend continues, shareholders of international funds could see a little boost in performance from an unexpected source - the declining value of the dollar.

Bad news for the mutual fund industry about the slowdown and concentration of net sales has just been compounded. Data shows that the market value of fund companies has declined 14 percent since 1997, while the market value of institutional asset management companies has risen 32 percent.

The company formerly known as The Equitable Cos. is renaming its sales force and moving it towards a fee-based structure in hopes that investors will associate the company with mutual funds and other products rather than just insurance products.

Frank Russell Company of Tacoma, Wa. is hoping to boost its defined contribution business by offering plan sponsors other retirement services. These additional services include defined benefit, deferred compensation and profit-sharing plans, along with investment education programs for plan participants. Russell is offering these services packaged with corporate cash management and strategic consulting services. Russell calls this its retirement savings strategic partnership program.

Lord, Abbett & Co. of New York will close the Lord Abbett Developing Growth Fund to new investors on Sept. 30. Like other popular mutual funds, the $2 billion fund was closed so that the fund's portfolio managers could effectively manage the fund's cash flow. The fund has performed well, returning 23.49 percent over the five-year period ending Aug. 31.

Barclays Global Fund Advisors of San Francisco will serve as the investment adviser to the three mutual funds that X.com, an Internet start-up in Palo Alto, Calif., plans to launch by the end of the year. John Story, who joined X.com in August as executive vice president and president of X.com Asset Management, had said the firm would break into the industry by aligning with "an extremely well-known, large money manager with a long history." (MFMN, 9/13/99)

Charles Schwab & Co. of San Francisco is offering investors a means of participating in some of the potentially high returns of Internet stocks while taking little risk. Schwab is offering two equity-linked certificates of deposit that are federally insured. One of the new CDs has a maturity value linked to the return of the Chicago Board Options Exchange Internet index, said Leslie L. Durschinger, Schwab vice president. The other CD's maturity value is linked to the return of the S&P 500, Durschinger said.

The City of New York's 457 deferred compensation plan, which has $250 million in assets under management, in November will begin offering employees a separate account managed by Citizens Advisers of Portsmouth, N.H. Citizens is the investment adviser to the socially- and environmentally- responsible Citizens Funds.

American Express Financial Advisors of Minneapolis, Minn., will offer mutual funds from the supermarket of Charles Schwab & Company of San Francisco. The supermarket now offers 2,000 funds.