NEW YORK - Mutual fund assets under management climbed to almost $2.5 trillion in 5,600 funds as of May 30, from $100 billion in 1980, and are projected to grow to $5 trillion by 2000, according to the Summer 1995 State of the Investment Company Industry report by KPMG Peat Marwick, New York.
In other findings:
Consolidations and acquisitions continue at a record pace. Already in 1995, there have been an estimated 20 announced transactions representing $100 billion.
Twenty-eight percent of mutual fund assets are in 401(k) plans, double the percentage of seven years ago. 401(k) assets have grown 23% annually during the past five years.
The industry is hoping the Senate goes along with the House of Representatives, which supports 50% capital gains deductions, deduction of inflation for the purposes of capital gains calculations and enhanced retirement savings programs. Legislation incorporating tax-free conversion of common trust funds to mutual funds also is possible, the report said.
NEW YORK - Mutual fund investors without foreign exposure are skittish about investing abroad.
Fifty-eight percent said they are not at all likely to buy such funds, compared with 49% last year, according to the second annual Scudder/Gallup survey of U.S. households that own mutual funds, conducted during March.
Only 14%, compared with 18% last year, said they plan to buy a global fund. Last year, nearly a quarter of non-owners concurred a diversified portfolio should include some international investments while this year 17% agreed.
The reason for the reticence? "Too risky/chance of loss" was cited by 18% of investors vs. 10% in 1994.
Eighteen percent also cited "lack of familiarity" as the main reason, compared with 20% last year.
But owners of global and international mutual funds remain committed to offshore investing and are focusing their objectives more on diversification and asset allocation and away from sheer returns.
The study was based on 1,000 telephone interviews of a random sample of households with stock or bond funds purchased outside an employer-sponsored savings plan.
HOUSTON - The Capstone Funds have gone no-load. The funds, managed by Capstone Asset Management Co. are: Medical Research Investment Fund Inc., which invests in healthcare companies around the world; Capstone Nikko Japan Fund; Capstone New Zealand Fund; Capstone Government Income Fund; and Capstone Growth Fund.
BOSTON - In a global expansion of its mutual fund record keeping operations, State Street Boston Corp.'s U.K.-based joint venture with DST Systems Inc. - Clark & Tilley Data Services Ltd. - will purchase The Administration Partnership Ltd. of Gartmore PLC and Henderson Administration Group PLC.
TAPL is an administration services business for unit trust and related products.
The transaction is expected to be completed soon.
Terms were not disclosed.
State Street is the leading mutual fund custodian in the United States, representing more than 40% of the industry's registered funds under custody.
BOSTON - Massachusetts Financial Services and Sun Life of Canada (U.S.) have added an emerging growth series to the variable account of the MFS Regatta Gold fixed/variable annuity. The mid- and small-capitalization growth stock portfolio will be run by John Ballen, who manages the MFS Emerging Growth mutual fund. The addition brings the number of variable options in Regatta Gold to 14; the contract also offers eight fixed options managed by Sun Life.
Jeff Etheredge has been named president and chief operating officer of Pilgrim America Securities Inc., the distribution arm for Pilgrim America Group, a new mutual fund family established to manage and distribute mutual funds acquired from the former Pilgrim Group Inc.
Mr. Etheredge formerly was national sales manager of American Capital Marketing Inc.
Mark E. Nagle has been named senior vice president-fund accounting services for the BISYS Group Inc.'s fund services division, Columbus, Ohio, an administrator and distributor of bank proprietary mutual funds.
Mr. Nagle formerly was a senior vice president and site manager for Fidelity Investments Institutional Retirement Services Co.
KANSAS CITY, Mo. - Jones & Babson, which recently introduced the Buffalo Balanced Fund, has now brought out three other funds using the same value strategy and subadvised by Kornitzer Capital Management, Shawnee Mission, Kan. In addition to the balanced fund, the new Buffalo Funds family includes the USA Global Fund, investing in domestic companies with growing international sales; a large-cap equity fund; and a high-yield fund.
ASHLAND, Mass. - Prospective mutual fund investors could be harmed more than helped if the Securities and Exchange Commission adopts a single risk measure for all types of funds, according to IBC's Moneyletter.
Ralph G. Norton, managing editor, said investors are smart. All they need are good tools to make their own investment decisions.
He urges greater risk education and testing for registered representatives; simplified wording to describe investment policies and their risks; supplements to prospectuses detailing portfolio holdings; and more frequent disclosure of portfolio holdings.