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The Fortune Group has licensed State Street Global Advisors of Boston to manage two exchange-traded funds based on the Fortune 500 and Fortune e-50 stock indexes. SSGA filed a registration statement with the SEC last week for both of the exchange-traded funds, the Fortune 500 Index Tracking Stock and the Fortune e-50 Index Tracking Stock, according to Fortune.

The Investment Company Institute of Washington D.C. has until July 31 to respond to a lawsuit filed by two shareholders alleging the organization is in violation of federal security laws, according to Ronald Rubin who is representing one of the shareholders. The ICI is expected to file a motion seeking a dismissal of the suit, said Rubin.

If funds want to offer exchange-traded funds, they might be wise to follow SSB Citi Asset Management Group of New York and Whatifi.com of San Francisco and start by launching traditional index funds, according to some industry analysts.

Fund companies are increasing their efforts to provide advice to 401(k) plan participants in order to develop a relationship that will steer a greater percentage of the assets rolled over from 401(k) plans to them, according to industry analysts.

Slowing growth of the mutual fund industry, a large number of funds on the market, disappointing share prices of publicly-traded asset management firms and competition from other types of financial service companies have prompted a recent spate of mergers and acquisitions, according to analysts.

If legislation introduced in the House of Representatives late last month becomes law, it would make it easier for fund companies to capture a greater percentage of the nearly $300 billion annual rollover of 401(k) assets, according to industry executives and analysts.

Exchange-traded funds are variously seen as new products that will radically change the mutual fund industry or the latest novelty that will fleetingly appeal to fickle investors and then be forgotten.

The General Accounting Office's report on fund profitability, which draws no conclusion as to whether fund companies have taken advantage of economies of scale to reduce fees but does encourage more disclosure of fees, has elicited a range of responses. It has been dismissed by some industry analysts as a self-serving move by politicians and welcomed by consumer advocates.

With the volatility of the equity market showing no sign of lessening, some fund companies are taking steps to protect investors from that volatility.

The Rupay-Barrington Financial Group of Arlington, Tex. issued a statement July 17 denying knowledge of a lawsuit the SEC filed against the firm accusing it of fraud. The SEC's charges were posted on its website July 12, and accuse the company of making improper loans to its affiliates resulting in inflated net asset values of its three funds. It also charges the companies with illegally suspending investor's redemptions, according to the SEC filing.

Info-One, a financial services consulting and technology company, of Campbell, Calif., has acquired Financial Planning Resources of Atlanta, Ga. for an undisclosed sum, Info-One has announced. Financial Planning Resources owns The VARDS Report and the VARDS Total Reference system.

The Investment Company Institute has asked the SEC to make changes in its after-tax rule proposal that would reduce the quantity of data funds would be required to disclose and would mean funds have to include the data in prospectuses only, not in annual reports as well.

The Investment Company Institute of Washington, D.C. last week announced its support of legislation that would revamp ERISA regulations to allow 401(k) plan providers to offer employees advice.

The Securities and Exchange Commission is considering allowing fund companies to shorten their bi-annual shareholder reports, according to a spokesperson for the SEC.

MutualFunds.com of Boston will launch its website this fall as a mutual fund site targeting three audiences - investors, mutual fund companies and financial advisors.

Waddell & Reed of Overland Park, Kan., will add two new share classes to its Waddell & Reed fund family in order to target supermarkets, 401(k) plans and wrap programs, the company announced last week.

A bill introduced in the House of Representatives would exempt from federal taxes up to $3,000 in mutual fund capital gains fund investors must accept even though they have not sold their fund shares. For investors filing joint returns, that exemption would be doubled to $6,000.

The SEC's final privacy regulation substantially departs from its initial proposal and allows fund companies to issue shorter, more general privacy statements than they originally would have had to, industry attorneys said.

The SEC is considering delaying revisions to the principal form investment advisors must file concerning their business practices because of objections raised to the proposed revisions.

The SEC has proposed new rules to protect auditor independence that will place new responsibilities on mutual fund companies.