Hewitt Associates terminated relationships with ``a handful'' of midsized defined contribution plan record-keeping clients that were ``no longer a good fit'' with Hewitt's record-keeping system, said Monica Gallagher, a Hewitt spokeswoman. She wouldn't identify the firms; they apparently required too many customized services. Hewitt will concentrate on customized record keeping for large clients and on a standardized, turnkey plan for small clients. Ms. Gallagher said Hewitt offered consulting and vendor search services to the terminated clients and helped with transition to new service arrangements.
Morgan Stanley Capital International today introduced an equity index covering the stocks of 24 Chinese companies, of which 13 are listed in China, eight in Hong Kong and three in New York.
The index represents about 60% of the shares of Chinese companies available to investors outside of China. MSCI also provides coverage of an additional 17 stocks that are not in the index.
The number of companies with fully funded pension plans increased in 1994, the first time in six years, according to Buck Consultants' annual survey of large corporate plan sponsors. According to Buck, 75% of companies studied had fully funded defined benefit plans in 1994, compared with 60% in 1993. The number of fully funded plans had gradually declined from 95% in 1988. In addition, the Buck study found the average discount rate increased by almost a full percentage point to 8.3% in 1994 from 7.32% in 1993. The Buck study was based on information gathered from annual reports of 489 Fortune 1,000 companies.
Trading began today in futures and options on the S&P 500/BARRA Growth and S&P 500/BARRA Value Indexes on the Chicago Mercantile Exchange and the Chicago Board Options Exchange. The CME offers trading in futures and futures options on the indexes, while the CBOE handles futures. The contracts are getting attention from investors using tactical asset allocation strategies, who will be able to adjust portfolios using style bets.
The median PIPER managed equity account outperformed the S&P 500 in the third quarter, returning 8.5% vs. the S&P's 8%. For the year ended Sept. 30, the median account returned 26.4% and the index, 29.7%. In fixed income, the median managed account matched the Salomon Broad index, with 1.9% for the quarter; for the year, the median account returned 12.7%, vs. 14.1% for the index.
The median international equity manager outperformed the EAFE index during the third quarter, 5.4% to 4.3%, but lagged the index for the year ended Sept. 30 - with 5.1% for the median manager and 6.1% for the index. Emerging markets median managers underperformed other international equity managers, with 0.2% for the quarter and -14.8% for the 12 months.
The Colorado Public Employees' Retirement Association, Denver, is a long way from its equity allocation target but hopes to reach it within two years. The target is 45% in domestic equities and 20% in foreign equities on an at-cost basis (the cost at which the securities were acquired). The fund now has 54% in both categories combined on an at-cost basis. A year ago, the figure was 50%.
``We're not pushing it. We're funding it through cash flow,'' said Don Schaefer, public information officer.
The fund also is decreasing fixed income to a goal of 15%. Currently it has 21.5%; last year, it had 28.5%, he said.