Pennsylvania Municipal Retirement System, Harrisburg, terminated large-cap value equity manager Newbold's Asset Management. The $700 million fund dropped the manager after trustees lost confidence in the firm because of changes over the past three years, said James B. Allen, chairman of the board.
Newbold's officials declined to comment.
Methuen (Mass.) Contributory Retirement System will decide whether to diversify investments and hire new managers this summer, said Tom Kelly, administrator.
The $42 million system has $39.5 million in a balanced portfolio with David L. Babson & Co. and $2.5 million in international equities with Brandes Investment Partners. Brandes, its first international manager, was hired last summer.
Segal Advisors is assisting. The review will start after the system's board is expanded to comply with a new law that mandates five trustees.
Sen. Carl Levin, D-Mich., plans to introduce legislation as early as this month that would let companies claim tax deductibility for executive pay in excess of $1 million only if they deduct the cost of stock option grants from their profits.
Under current law, tax deductions for executive pay are capped at $1 million.
If the stock market drops 20% or more in this downturn, it could take some time to climb back, according to Peter Anderson, chief investment strategist at American Express Financial Advisors. The 29 market declines of 20% or more since 1900 averaged -34.7% and required five to six years to return to previous highs, said Mr. Anderson.
Mr. Anderson said the industry needs to ``dampen down greed and reduce fear'' among clients, who need to decide whether to reallocate or ride out the downturn. He predicts it's going to be tough to make money in the market in 1997; cash probably will be the best performing asset class and a 5% return might look good.
J.P. Morgan Investment Management will introduce a retail and institutional version of an international equity mutual fund.
The funds, The JPM Pierpont International Opportunities Fund and the JPM Institutional International Opportunities Fund, will be diversified in established and emerging markets, but will not be tied to specific allocations into specific regions. The funds are intended to complement existing JPM funds with specific country or regional mandates.
American Express Institutional Services added 11 non-proprietary mutual funds to its SmartPartners alliance for full-service bundled defined contribution clients. Bob Richey, senior vice president of investments, said the alliance now has 21 outside fund offerings and 18 American Express funds.
The 11 new funds from 13 families are a ``best in class'' group of top-performing, top-quartile funds.