Investment funds

Because of the havoc that 2008 wreaked on so many investors’ portfolios, 46% of the 468 diversified U.S. equity funds that have had the same manager for the past decade, have negative returns for the 10 years ended Feb. 28, The Wall Street Journal reports. By comparison, the S&P 500 fell 3.4% on average over the past 10 years.

Conservative offerings and more focused customer attention will be the tenants of the fund industry going forward, according to speakers at the recent “Future of Fund Management” conference in London.

Bond funds took in $5.64 billion but stock funds lost $232 million in the week ended March 18, according to the Investment Company Institute.

Morningstar is now offering information on fund flows and market share to its institutional clients through its Morningstar Direct platform.

Federated’s assets rose 31% in the final five months of 2008, from $271.1 billion on June 30 to $355.7 billion at year’s end. During the whole year, the firm’s money market funds took in $110 billion.

Testifying before the Senate Banking Committee on Thursday, Securities and Exchange Commission Chairman Mary Schapiro vowed to impose stricter regulations on a broad array of securities and practices, including money market funds, whose holdings would adhere to stricter credit quality, maturity and liquidity standards.

Stable-value funds, available in such tax-deferred accounts as 401(k)s, have been attracting a lot of attention lately, having returned 4.7% in 2008, compared to the Dow’s 33.8% decline, The Wall Street Journal reports.

Hit with $3.2 billion in redemptions in the first quarter, an 11% reduction in assets under management, Man Group said it plans to reduce its headcount by 15%, or approximately 270 positions, to save $60 million a year.

Healthcare costs for a 65-year-old couple retiring in 2009 would total $240,000 over the remainder of their lifetimes, up 6.7% from the $225,000 needed in 2008 and a whopping 50% from $160,000 in 2002, according to estimates by Fidelity Investments.

Sixty-seven percent of asset managers surveyed by Russell Investments said corporate bonds look attractive, 61% are bullish on junk bonds, and 57% are optimistic about equities. This is the first time in five years that money managers have had a more favorable outlook on fixed income than on stocks.

A last-minute Bush administration regulation that would permit advice in 401(k) plans was called into question Tuesday by a number of consumer advocates and other experts who testified before the House Committee on Education and the Workforce.

Legg Mason has laid off 120 employees, 20 of whom worked in mutual fund administration and 100 of whom worked in its Western Asset Management subsidiary.

While the economy has hit most asset managers and investors hard, the top 25 hedge funds earned a breathtaking $11.6 billion in pay last year, according to Alpha Magazine.

Fund giants headquartered in Boston, still one of the biggest capitals for mutual fund companies in the nation, have taken a particularly hard hit, Boston Business Journal reports, losing an estimated $500 billion over the past year.

Target-date funds continue to take the heat for buckling under the pressures of the market’s decline.

Janus paid its chief executive officer $7 million, including bonus, in 2008, a 27.8% pay cut, a Securities and Exchange Commission proxy filing indicates.

Hennessy Advisors has acquired the Tamarack Large Cap Growth Fund and the Tamarack Value Fund, which hold $158 million in assets between them. Voyageur Asset Management, a division of RBC Asset Management, was the investment advisor before.

PIMCO and BlackRock are two of the first mutual fund companies to sign up for the Treasury Department’s new program to purchase troubled assets—PIMCO as both a buyer and manager of debt and BlackRock only as a manager. Other fixed-income fund shops are likely to sign up as well, Geoff Bobroff of Bobroff Consulting told Dow Jones.

Because the credit markets and asset values are at the very heart of the economic crisis, these areas will have to strengthen before the economy improves, according to Fidelity Investments, Bloomberg reports. As such, financial services will have to be the first area to improve, and it will lead the way out of the recession.

FINRA has fined 25 broker/dealers for failure to complete self-assessments related to providing mutual fund breakpoints between 2001 and 2002.