Executive Briefings

NEWS SCAN

SEC Examiner, Enforcement Collaboration Now "Seamless"

Collaboration between the Division of Enforcement and the Office of Compliance Inspections and Examinations at the Securities and Exchange Commission "really is very seamless," according to OCIE director Carlo V. di Florio.

OCIE has referral committees in every region of the country, for looking at specific exams and specific issues that warrant further attention by enforcers. And escalation procedures are in place.

But, in practice, don't think there are two distinct groups, "one called exam and one called enforcement," said George S. Canellos, acting enforcement chief, last week at the Investment Company Institute mutual funds conference.

BlackRock to Cut About 300 Jobs

BlackRock is cutting about 300 jobs, extending a reorganization that included a shakeup of its investment units last year.

BlackRock will reduce its workforce by less than 3%, with some workers leaving immediately and others over coming months, President Robert Kapito said last week in a memo to employees. Kapito said in the memo that BlackRock will continue to hire and will probably have more employees at the end of 2013 than at the end of 2012.

SEC to Mutual Funds: It's Okay to Say....

The Securities and Exchange Commission last week published a guidance update to clarify what mutual funds and other investment advisors can say on their social media sites.

According to the SEC's staff, an incidental mention of a specific investment company or family of funds not related to a discussion of the funds' investments need not be filed with Financial Industry Regulatory Authority.

Fidelity's $7.95 ETF Trading Tag

Fidelity Investments and BlackRock last week announced a long-term strategic alliance whereby millions of Fidelity customers will get "increased and improved access to a broad selection of passive ETF solutions provided by iShares" and iShares access to Fidelity's distribution capabilities.

As part of the deal, Fidelity increased the number of iShares ETFs that can be traded commission-free online from 30 to 65. The new list includes all 10 iShares Core ETFs as well as a selection of international, domestic, and specialized equity, fixed income and commodities ETFs.

According to Fidelity's website, 10 iShares ETFs from the original 30 are no longer commission-free "in order to avoid overlap and to offer less expensive choices." The firm reasoned that, instead of offering both the Russell Index and S&P ETFs, it now only offers the S&P ETFs commission-free. But if investors want, they can still trade these 10 iShares ETFs and any other ETFs, for that matter, for a fee of $7.95.

AQR, DFA Snag Equity Mandates

Los Angeles-based Aspiriant is launching a new equity fund dubbed the Aspiriant Risk Managed Global Equity Fund, which will bet on a diverse group of common stocks of companies in developed and emerging markets with an emphasis on small capitalization and value companies.

AQR Capital Management (Jacques Friedman, principal, Andrea Frazzini, vice president, and Hoon Kim, vice president) and Dimensional Fund Advisors (Joseph Chi, Jed Fogdall, and Karen Umland, each senior portfolio managers, and Henry Gray, Head of Global Equity Trading) serve as the sub-advisors for the equity portions of the fund while Parametric Risk Advisors serves as the sub-advisor for the options overlay strategies of the fund.

Cambiar Closes Small Cap Fund

Denver-based Cambiar Investors will close the Cambiar Small Cap Fund (CAMSX) to new investors on April 30. The fund was launched in October 2008 and is managed by Brian Barish and Andrew Baumbusch. It managed some $1.3 billion as of March 15, according to Bloomberg.

RESEARCH

Institutions Drive Equity ETF Growth

Institutional investors held around half of total equity exchange-traded fund assets in 2012, according to a new report from Strategic Insight.

Institutional presence was heaviest among international equity ETFs, beating out ownership by individual investors and financial advisers with holdings of 57% of total assets.

Cerulli: Advisors Out of Touch With Clients' Risk Profiles

New findings from Boston-based global analytics firm Cerulli Associates show that clients feel their advisors often recommend products that do not fit their risk profiles.

Specifically, the firm's research reveals a significant disconnect between the percentage of advisors who believe their clients have an aggressive risk level (26%) versus what clients actually report (8%), according to Patrick Newcomb, senior analyst at Cerulli Associates.

PRODUCTS

WisdomTree Gets Active in Brazil

WisdomTree Asset Management is prepping the WisdomTree Brazil Bond Fund (BBF) to launch within the next few months.

The fund will bet on debt securities issued by the Brazilian government, quasi-sovereigns and corporations that are organized in Brazil, according to a regulatory filing. ALPS Distributors serves as the distributor for the fund.

MINC Takes On MINT

AdvisorShares launched an actively managed exchange traded fund.

AdvisorShares Newfleet Multi-Sector Income ETF (MINC) is a short duration bond ETF that will be subadvised by Virtus affilliate Newfleet Asset Management. The ETF started trading on March 20.

Nuveen Goes Global With Latest Funds

Nuveen Investments has launched two new dividend-focused funds.

Both Nuveen Santa Barbara Global Dividend Growth Fund (NUGAX) and Nuveen Santa Barbara International Dividend Growth Fund (NUIAX) seek out companies across the world that pay and have the ability to maintain their dividends on a long-term basis. They will be managed by Nuveen's dividend-focused growth equities manager, Santa Barbara Asset Management.

ARRIVALS

Sentinel Adds Ex-Paradigm PM

Sentinel Investments has hired Jason Ronovech, as lead portfolio manager of both the Sentinel Small Company Fund (SAGWX) and Sentinel Mid Cap Fund (SNTNX).

In addition, Ronovech will be named co-portfolio manager on the Sentinel Sustainable Mid Cap Opportunities Fund (WAEGX). He will also be co-manager on the Sentinel Mid Cap II Fund until it is merged into the Sentinel Mid Cap Fund on April 12.

Grandeur Peak Hires Two Wasatch Alums

Grandeur Peak Global Advisors is growing.

The Salt Lake City firm has added Zach Larkin as a senior research analyst and Juliette Campbell as manager of trading and operations.

Nationwide Picks Up Wholesalers From Putnam, Hancock

Nationwide Funds Group, the mutual fund business of Nationwide Financial, has added five new wholesalers to its sales team.

The new additions to Nationwide's mutual funds sales team include:

* Chris Finch, divisional vice president for the West Coast, who joined from John Hancock Funds where he was a senior vice president and Kumar Jagdeo II, who will serve the Michigan territory as a regional vice president. Jagdeo joins Nationwide from AllianceBernstein, where he was a wholesaler.

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