Fund performance

It's counterintuitive-wealth managers are ratcheting up the price and providing lower returns on variable annuities. Some providers have doubled prices in the past six months, and more changes are expected.

Mutual funds have been able to thrive for the past 85 years thanks to their ability to adapt to changing markets and help investors stay diversified during good times and bad.

Investors seeking safety and stability have recently been moving massive amounts of their assets into money market mutual funds, causing the funds to swell to nearly $4 trillion and making them the single largest mutual fund asset class, according to the Investment Company Institute.

Financial advisers proved their worth in the second half of 2008, with their clients' average returns 16 percentage points higher than the S&P 500, Fidelity found in a survey of 300 investors and 200 advisers.

Power Financial experienced its first quarterly loss in 15 years, losing $773 million, or $1.12 a share, compared with profits of $532 million, or 73 cents a share, in the fourth quarter of 2007.

Hedge funds will continue to suffer poor results and redemptions for the next four years, Sanford C. Bernstein Analyst Brad Hintz told Reuters. And over the next year, one in four hedge funds will shut down, Hintz added.

Socially responsible investing has been offering one of the few positives for investors during the recession, the Orlando Sun-Sentinel reports.

Thinking about retirement is anything but positive and encouraging, even for those in their 20s with a 40-year time horizon for saving. Most planners recommend an absolutely ungodly sum of cash as the entry point to safe and sound years. The government continues to predict the demise of Social Security. Insurers warn about soaring healthcare and long-term care costs. And now, with the market having wiped out $11.1 trillion in market wealth since it peaked in October 2007, retiring is absolutely unrealistic for many.

Congress is considering whether to make major revisions to the fair-value accounting rules that have created so much controversy lately. Possible changes include suspending the rules, improving value-at-risk measurements and reinstating the uptick rule.

Invesco's Atlantic Trust Private Wealth Management plans to take advantage of the "chaos" in the financial services industry to add assets and customers, according to its new chief executive officer.

The mutual fund industry is eager to hear the outcome of a U.S. Supreme Court case that could determine the fate of the Gartenberg standard, an old legal precedent used to determine whether mutual fund fees are too high that has set a high burden of proof for investors and spared the industry from lawsuits.

Investors in need of cash or traumatized by the Bernard Madoff scandal will continue to redeem hedge fund shares in droves, HedgeWorld News predicts, shrinking the industry by 30% this year to as low as $1 trillion. That was the size of the industry in 2005.

Fidelity Investments is treating investors’ unease with the markets as an opportunity to help them revisit their retirement goals, risk tolerance, household budget and preparedness for job loss, by holding 500 seminars around the nation, offering online tools and running ads.

The financial crisis has taken a serious toll on millionaires, with their ranks falling 27% in 2008 from 9.2 million at the beginning of the year to 6.7 million by year-end, Spectrem Group found. That brings the total down to 2003 levels, when there were 6.2 million millionaires in the nation.

Despite the plummeting economy, most 401(k) participants are staying calm and behaving normally, according to 2008 year-end data from the Investment Company Institute.

Putnam Investments will waste no time reinvigorating its defined contribution business, and its long-struggling equity funds will have to earn their way into the mix, according to Robert L. Reynolds, its president and chief executive.

Over the past year, as the S&P 500 has hit 1997 levels, the U.S. gross domestic product shrank 6.2% in the fourth quarter of 2008 and investors' retirement savings have been severed in half, we have hailed the resilience of investors' faith in the markets. Our customers have continued to believe in the soundness of investing in mutual funds, the premise of long-term investing and modern portfolio theory, and the overall wisdom of saving for retirement.

In order to achieve meaningful reform of the financial services industry, Congress should create two key regulatory positions to oversee financial markets, according to a proposal last week by the Investment Company Institute.

Growth fund managers typically seek out companies whose earnings increase 10% or more a year, but with the economy sagging, those managers are applying metrics they’ve never used before, The Wall Street Journal reports.

With stocks now worth less than 55% of their peak in October 2007—a decline of $11.1 trillion in market wealth—investor sentiment has been shattered and some market experts believe the process of finding the market bottom must begin all over again.