Mutual funds

The Eighth U.S. Circuit Court of Appeals has just ruled in favor of investors in a case against Ameriprise Financial over the fees of 11 of its RiverSource mutual funds. Coming on the heels of a similar case against Harris Associates that the Supreme Court will hear this fall, it could signal a new era in favor of investors.

The Eighth U.S. Circuit Court of Appeals has just ruled in favor of investors in a case against Ameriprise Financial over the fees of 11 of its RiverSource mutual funds. Coming on the heels of a similar case against Harris Associates that the Supreme Court will hear this fall, it could signal a new era in favor of investors.

Fidelity’s net profits fell only 4% last year, and they may be weak again this year, despite cost-cutting measures and laying off 3,000 workers, Fidelity President Rodger Lawson warned employees in a recent memo. As a result, the company may scale back on year-end bonuses and merit pay for those in the middle and lower earnings brackets.

Following a three-month investigation, the state of Oregon is seeking $36.2 million in damages from OppenheimerFunds due to steep losses in one of its funds included in the state’s 529 college savings plan; the Oppenheimer Core Bond Fund fell 36% in value last year, and is down another 10% year-to-date.

FINRA ruled in favor of an NFL retiree, Jerome Woods of the Kansas City Chiefs, who lost $1.7 million in Morgan Keegan mutual funds, but awarded him only $950,000. Woods is among dozens of investors who have filed lawsuits against the firm after losing 90% of their investments.

With assets continuing to fall, mutual fund companies are looking for new ways to cut costs, and outsourcing the promotional and public relations aspects of marketing is one of them, and the movement could become permanent, according to a report from Optima Group, “Surviving the Crisis in Asset Management.”

Bill Gross, managed of the PIMCO Total Return Fund, has expanded his U.S. government debt exposure from 15% in February to 28% in March.

Talk about reversal of fortune. Up until the economic crisis took full effect in 2008, mutual fund companies were anxious to get into the hedge fund game. Now, with investors heading to the hedge fund exits, the opposite is happening.

Dreyfus is planning to launch two funds-of-funds, the Dreyfus Diversified Global Fund and the Dreyfus Satellite Alpha Fund. The diversified global fund seeks long-term capital appreciation by investing in six of Dreyfus’ other funds, including those tied to equity income, real estate, sustainability investments, worldwide growth, global alpha and global equities.

Retirement confidence has hit a record low since the Employee Benefit Research Institute began its annual survey in 1993, with only 13% saying they believe they will have enough money for a comfortable retirement, and 25% saying they believe they will have enough money for just basic expenses. Those already in retirement also have downgraded outlooks, with only 20% saying they are very confident.

LECG Expands Platform With Hiring of Vinella

Rather than stress individual fund performance or investors' malaise in its new advertisements, Fidelity is focusing on providing sound guidance and building on its trusted brand. And that is the focus of the "Guide to Personal Savings" campaign, taglined "Turn Here," Fidelity Chief Marketing Officer James D. Speros told The Boston Globe.

Half of participants in 401(k) plans would like to have the option of rolling their money into a guaranteed income solution, but that does not exist in their plan, MetLife found in a recent survey, its seventh annual Employee Benefits Trends Study. Only 21% of employers said they would consider offering guaranteed income solutions, and only 16% of employers currently offer income annuities in their 401(k) plan.

Frugality Expected to be the 'New Normal'

With new global regulations forthcoming, corporate compliance departments will need to upgrade aging systems and expand automation technology just to keep up. The time for little fixes may be over, and firms cannot use the recession as an excuse for putting investments off.

Equity funds were clobbered in the first quarter of 2009, declining 9.25%, Lipper reported last week. Performance would have been even worse, were it not for a surprise rally in March.

The Securities and Exchange Commission is considering eliminating the stable, $1 net asset value (NAV) requirement that money market mutual funds have long held, by either making the funds have a floating $1 NAV or a $10 NAV.

All things considered, earning $46 million in 2008 was far less than the $81 million Mario Gabelli of Gamco took home in 2007 and the $81 million he pocketed in 2002, DealBook reports, citing a proxy filing.

PIMCO has promoted 78 of its executives, with 12 now executive vice president, 24 senior vice president and 42 vice president.

Money funds netted $12.2 billion in the week ended April 8, the Investment CompanyInstitute announced. Total assets in money market funds reached $3.846 trillion.