BOSTON -- No one said it would be easy to top the Standard & Poor's 500 index last year, but some mutual fund companies had a significant number of funds, both active and passive, beat the benchmark.
Financial Research Corp. crunched the numbers and found Janus Funds, Denver, was far and away the winner of the 1998 beat-the-index stakes. More than 83% of Janus' eligible funds and 98% of $50 billion of eligible assets under management beat the S&P 500.
The Pioneer Group, Boston, followed with 50% of its eligible funds and 49% of its $17 billion of eligible assets beating out the large-cap index last year.
For AIM Distributors, Houston, 44% of eligible funds and 81% of $38.8 billion of eligible assets skunked the S&P in 1998. About 38% of American Fund Distributors' eligible funds and 19% of its $152 billion beat the index for the Los Angeles-based fund family.
Fidelity Investments, Smith Barney Advisors, Merrill Lynch Asset Management and Prudential Securities all had 28.6% of their eligible funds beat the S&P 500. Within this group, however, Boston-based Fidelity stood out with 42.7% of $319.9 billion in eligible assets beating the S&P 500. By contrast, only 10.9% of New York-based Merrill's $20.8 billion in eligible assets beat the benchmark.
FRC's methodology checked fund complexes with more than $500 million under management in domestic equity assets as of Dec. 31; included only portfolios within the Lipper Growth, Growth & Income, S&P 500 and Capital Appreciation objectives; used the fund performance of the oldest share class of each fund that had to have a one-year track record; and rolled assets up to the portfolio level.
A third don't know what IRA stands for
KANSAS CITY, Mo. -- Despite the hype in the popular press and the massive education campaign waged by every major mutual fund company, a lot of Americans still don't get it. Almost one-third of respondents to a recent survey didn't know what IRA stands for.
According to the results of the third annual general aptitude gauge of retirement basics conducted by American Century Investments, 69% of retirement savers surveyed knew for sure that IRA stood for individual retirement account; one in 10 responded it was "indivisible retirement allowance." In American Century's third annual survey of investors' grasp of retirement basics, not one of 753 interviewees answered all 10 questions correctly.
The same retirement savers also have eschewed the Roth IRA format and stuck with the traditional vehicle. Among respondents who plan to make contributions to their IRAs in 1999, two-thirds will put that money into traditional IRA accounts. Only 13% actually converted their existing IRA accounts to Roth accounts.
At least willingness to invest in the stock market has improved. The percentage of investors who owned stock mutual funds rose to 43% in 1999, up from 32% reported in another survey, American Century's fourth Retirement Savings Snapshot survey. About 37% of respondents now said they own individual stocks, compared with 29% four years ago.
Mutual fund investors say they like supermarkets
SAN FRANCISCO -- Mutual fund investors prefer supermarkets, according to a new survey by Spectrem Group.
The preferences of 2,100 investors interviewed for the survey were fairly evenly distributed among three options:
* 35% preferred a fund supermarket with consolidated statements, ongoing professional advice and a flat 3% annual load (no other fees or loads);
* 34% preferred a fund supermarket with consolidated statements, no advice, but a lower annual fee of 1.5% (no fees or loads);
* 29% liked to put together a portfolio outside a supermarket context, with no investment advice and paying any fees and loads required by the mutual fund managers.
The rest of the respondents did not have preferences.
Almost one-third had already made investments using the first method and 26% had made investments using the second method.
Nvest analyzes international equity, bond funds
BOSTON -- Nvest Retirement Services expanded its holdings-based analysis to include international equity and fixed-income mutual funds. The service assesses risk exposure, performance and investment style based on mutual fund portfolio holdings.
Nvest now offers holdings-based analysis on 14 of the funds of its affiliate money management units to defined contribution plan sponsors, consultants and plan service pro-viders. The analysis had beenavailable only for domestic equity funds.
Channel Islands-based Bachmann bought by BISYS
LITTLE FALLS, N.J. -- The BISYS Group Inc. expanded its international mutual fund administrative capabilities through the acquisition of Bachmann Asset Management Ltd., Guernsey, Channel Islands. Bachmann offers mutual fund administration and accounting.
With the acquisition, BISYS now has fund administration centers in Dublin, Ireland; London; the Cayman Islands; and Guernsey to service the offshore mutual fund industry.