Investments

"Moving away form AAA ratings is sacrilege," protests Peter Crane of Crane Data.

Fearful of how a change in ratings will help them market their funds among investors, money fund managers are chafing at the idea of Moody’s’ proposed new ratings. Investors are used to looking for AAA-rated money market funds, and it will take some time for them to get to a scale ranging from MF1 to MF4, money managers tell The Wall Street Journal.

WASHINGTON — Senate Finance Committee Chairman Max Baucus on Thursday proposed to extend the Build America Bonds program for only one year in legislation he unveiled that would extend several expiring or expired bond and tax provisions.

Exchange-traded funds will continue on a strong, albeit somewhat scaled back, growth track, expanding assets by an average of 19% a year over the next five years through 2014, according to Financial Research Corp. Over the last five years, the annual growth rate has been 23%.

Margins of asset management firms have declined significantly in the past 10 years, according to a report from kasina. In 2000, operating margins stood at 39%. Today, they are 29%. And net margins, 27% 10 years ago, are now 20%.

The Unified Managed Account Exchange gives RIAs more control over product selection.

Thin supply of short-term holdings and low yields are pushing managers into complex, potentially risky and illiquid instruments.

Fixed-income money manager Cutwater Asset Management has entered into a strategic partnership with Tandem Global Partners, the New York firm announced today.

But there were also fewer hedge-fund launches, as investors continued to shun startups and smaller firms in favor of large, established players.

Despite the new rules that the SEC imposed on money market funds in January – or perhaps because of them – managers are challenged to find an adequate supply of investments. The scarcity of debt with a maturity of less than seven days, combined with low yields, is pushing money market fund managers into areas of the fixed income and cash management markets they previously would not seek out, The Wall Street Journal reports this morning.

Low rates on fixed annuities force advisors to branch out into life insurance sales, hitting a home run.

Establishing a presence in China is slow going, but Northern Trust Corp., which recently won approval for a Beijing branch office, believes the payoff will be worth the wait.

Despite declining trading activity industrywide, Charles Schwab Corp. announced Wednesday that it expects third-quarter results will be in line with the previous quarter.

Institutional broker dealer MF Global Holdings has hired Greg Shonhorn for its fixed- income group in New York effective Sept. 7.

The Swiss financial services company will pay $425 million for a minority stake in the New York hedge fund manager.

The fixed-income trend is leading the bumper inflows for bond-heavy fund families, while investors continue to punish American Funds for not being “bear-proof.”

Fixed-income funds held their siren-like draw for investors, contributing largely to long-term mutual funds’ $16.8 billion in inflows in August, according to a Morningstar analysis.

State Street Global Advisors has launched a global natural resources exchange-traded fund.

The U.S. economy is on an expansionary, albeit sluggish, path—not toward a double-dip recession, says BNY Mellon Chief Economist Richard B. Hoey. In the near term, however, hold onto your hats: The “most pronounced weakness in the U.S. economy” will become apparent in the second and third quarters of this year, he says.

Altegris Advisors has launched the Altegris Managed Futures Strategy Fund, an actively managed mutual fund aimed at both retail and professional investors. In launching the fund, the alternative investments manager noted that in the past decade, U.S. stocks declined 17%, but managed futures gained 122%.