Investments

Besides supporting four money market funds with exposure to structured investment vehicles with $420 million in capital of its own, Legg Mason has signed a one-year renewal with a bank to support $355 million in SIV securities. As of Nov. 30, the par value of SIV exposure in the funds was $2.8 billion, down from $10 billion as of Oct. 31, 2007.

The “perfect storm” of high volatility, withdrawals and liquidity problems that has hit hedge funds will soon subside, Man Group CEO Peter Clarke told the Hedge Fund World Zurich conference, Dow Jones reports. In fact, hedge funds could turn the corner as early as the second quarter of next year, Clarke said.

Fidelity Investments announced Tuesday it is reopening two of its largest funds, Contrafund and Low-Priced Stock Fund, to new investments, effective Dec. 16.

There was a time that the highflying world of hedge fund managers appeared to stratospherically surpass that of mutual fund managers. After all, some of the top hedge fund managers have averaged annual salaries of $250 million in recent years, with $1 billion paydays not uncommon for top stars.

With the markets siphoning value from mutual funds and investors running for cover to the tune of billions of dollars in redemptions a month, Fidelity Investments is trying to hold onto customers’ assets by promoting FDIC-insured certificates of deposit.

Finance and technology stocks have put the Fidelity Magellan fund in a worse position than its benchmark, the Standard & Poor’s 500, and even the fund’s manager says he’s disappointed, Dow Jones reports.

Rather than honor the $1.4 billion in redemptions, or 14% of the $10 billion flagship hedge fund at Paul Tudor Jones’ asset management firm on Dec. 31, the company will delay making those payments until March 31, 2009, in hopes that the market will improve and assets can be sold for higher values, Dow Jones reports. Normally, the fund honors redemptions once each quarter.

The Rydex Investments AdvisorBenchmarking Advisor Confidence Index, which gauges advisers’ outlook on the economy and the stock market, rose 4% in November to 82.46, up from 79.07 in October.

Be it large-, medium- or small-cap, value or growth, there are buying opportunities galore in the stock market, according to veteran Lord Abbett value manager Robert Fetch. “I am seeing valuations I haven’t seen in decades, across the capitalization spectrum,” Fetch told Barron’s.

CIBC announced Friday that it has finally settled 2004 charges that former trader Paul Flynn permitted hedge funds to market time mutual funds.

Mutual Funds Have Bled $2.5 Trillion Since May

Putnam Selects Farrell as Head of Equity Trading

Don't believe the retirement income hype.

The signs are clear, but few firms are making decisions that will benefit them in the long term. The financial crisis is prompting firms to feel forced to react and make changes to their short-term and long-term strategies.

The $600 million in new assets that Horizon Cash Management captured in the third quarter could be a sign of things to come for the Chicago company and other cash managers.

Fund Fees Expected to Tumble By $38 Billion by 2012

Slowly but steadily, the Securities and Exchange Commission continues on the long journey toward adopting international tax and accounting standards, with the recent release of its long-anticipated roadmap.

Mutual funds had $9.5 trillion in assets as of Oct. 31, a full $2.5 trillion, or 21% less, than their year-to-date $12 trillion under management peak at the end of May, Lipper data shows. Since the beginning of the year, when mutual funds had $11.7 trillion under management, assets have fallen 19%.

The $600 million in new assets that Horizon Cash Management captured in the third quarter could be a sign of things to come for the Chicago company and other cash managers.

First the good news. The average 401(k) plan balance is down only 14% this year to $68,000 from $79,000 in 2007, according to Hewitt Associates. And since the precipitous decline in the stock market of the past few months, only 4% of participants have decided to stop contributing.