Mutual funds

The Investment Company Institute announced Tuesday that it is forming a money market mutual fund working group, to be chaired by Vanguard Chairman John Brennan.

Encouraged by new lows in the Nikkei Stock Average, as well as other major indices, Japanese investors are buying up stocks, the Nihon Keizai Shimbun reports.

Due to what it calls deteriorating weighted average credit quality, along with a volatile and falling net asset value, Moody’s has downgraded its rating for the Lehman Brothers Enhanced Libor Fund from Aaa/MR3 to A/MR5. Moody’s said the rating would remain on review for further downgrade, due to its holdings in securities backed by residential mortgages and credit card payments.

The $3.2 billion Vanguard Insured Long-Term Tax-Exempt Fund is being liquidated and folded into the $2.8 billion Vanguard Long-Term Tax-Exempt Fund.

After a $200 billion run on money market funds in September, the operations of, and flows to, money market funds are beginning to return to normal, the South Florida Sun-Sentinel reports.

In response to the Securities and Exchange Commission’s charges that it spent more than $600,000 on improper gifts and entertainment for Fidelity Investments traders, Lazard Capital Markets is paying $2.8 million to settle the charges.

Bear market fund investors have struck it rich, with the best-performing such fund, the Rydex Inverse Nasdaq 100 Fund, up 107% over the past 12 months, businessworld.com reports. Year-to-date, the fund is up 88.7%, and in the past month alone, 16.6%.

While asset flows have continued at a steady clip for exchange-traded funds—the funds have taken in $100 billion so far this year—widespread declines in the values of all asset classes have siphoned about 30% of ETF assets, leaving a net of $440 billion in 716 ETFs, Dow Jones reports.

Vanguard has reopened the $1.5 billion Vanguard International Explorer Fund, which closed in 2004, and the $3 billion Vanguard Precious Metals and Mining Fund, which closed in 2004. The minimum required initial investment in the international fund is $25,000, and the minimum initial investment in the metals fund is $10,000.

Adviser confidence in the economy and stock market sank this month for the second consecutive month, according to Rydex AdvisorBenchmarking, a division of Rydex Investments.

Prudential Arm Hires Structured Exec Bonesteel

NEW YORK - The fragmented, free-for-all liquidity in the marketplace is aggravating the extreme volatility in the stock market, and experts say a more organized, specialized system is needed.

With the stock market down 40% in the past year, many investors are reassessing their investments. Many, in fact, are bailing out of equity mutual funds, vowing never to return.

4,000 Could Lose Jobs at Fidelity

LAS VEGAS - As companies pare back their operational budgets and look for ways to trim costs, chief information officers are being challenged to make their IT departments do far more with much less.

The question everyone is asking, not just shell-shocked investors, but financial advisers and economists as well, is how low can the Dow Jones Industrial Average go? And the answer is, very, very low. Some pessimists are now predicting the Dow 900.

The Reserve Management Company has begun making distributions to shareholders at an initial rate of 50 cents on the dollar, and its president says the company plans to pay the rest soon.

Adviser confidence in the economy and stock market sank this month for the second consecutive month, according to Rydex AdvisorBenchmarking Inc., a Rockville, Md., unit of Rydex Investments.

Many large corporations and asset managers in Massachusetts are planning to cut jobs, and by the best estimates, the state could lose jobs for 4%, or 7,200, of its financial servcies workforce by the end of next year, slightly higher than an estimated 3% decrease in the rest of the nation, The Boston Globe reports.

Adviser confidence in the economy and stock market sank this month for the second consecutive month, according to Rydex AdvisorBenchmarking, a division of Rydex Investments.