BOSTON -- While various national public opinion surveys have shown that Americans aren't wild about Roth IRAs, Fidelity Investments had a different experience this spring.
Of the customers investing in individual retirement accounts at Fidelity through April 15, about half -- representing $674 million -- invested in a Roth account.
1999 already has proven to be Fidelity's best year of growth in IRA assets since 1986. Total IRA contributions were $1.3 billion through mid-April, an increase of $441 million over all of last year, with more than 300,000 new Roth and traditional accounts opened.
Fidelity commissioned International Communications Research to conduct a survey recently, which found that while 27% of Americans said they had IRA accounts, only 5% owned a Roth IRA. One-third of those surveyed who had never opened an IRA, but thought they might be eligible to open a Roth, said they were too confused to proceed or didn't have enough time to research the investment vehicle. The survey indicated that one in four people said they didn't have enough money to fund any kind of IRA.
Almost three times as many contributions were made to tax-deductible IRAs as were made to Roth IRAs, the survey found. More than half of investors who funded their IRAs in 1998 made contributions to traditional IRA vehicles. The survey also indicated that 31% of IRA investors sought the advice of a financial adviser in making decisions.
T+1 equals trouble for many firms
NEW YORK -- If the Securities and Exchange Commission required trading settlement within 24 hours for mutual funds tomorrow, as much as half of the industry would be unprepared.
About one-third of companies would be seriously affected if the settlement, known as T+1, is required by the SEC, according to the results of a survey, conducted by KPMG LLP, of mutual fund executives at the Investment Company Institute's annual meeting in mid-May. Around half of those surveyed said T+1 will have "some impact" on their companies, and 20% said they would not be affected.
Exactly half of the 100 mutual fund executives surveyed at the ICI meeting said their company needed assistance in making their technology and information systems T+1 compliant. About 40% said their administrative back-office functions weren't ready; 12% said the trading desk needed help; and 17% said their portfolio management operations would need assistance. Almost 20% were undecided about their company's T+1 readiness in specific operational areas.
Almost half of those surveyed, 47% said their companies were fully prepared to move to T+1 for domestic trades. About 30% said their companies were "months behind" for domestic trades; 17% said their companies were completely unprepared; and 7% were undecided. Far fewer companies, 28% would be fully compliant now with T+1 for cross-border trades, but 38% said their companies were only months from being ready. About one-quarter said their firms were completely unprepared and 10% didn't know.
Firm makes searching EDGAR much easier
NEW YORK -- Mutual fund consultant Strategic Insight Inc. has developed a powerful search engine that makes searching for mutual fund information on the Security and Exchange Commission's EDGAR database a snap.
Fund Filing is a Web-based tool that simplifies and speeds searches through mutual fund SEC filings (since 1997), including prospectuses, annual reports and other documents. The program covers open- and closed-end mutual funds and variable annuities and contracts.
Search criteria are flexible: Users can search by investment objective, fund category or date. Fund Filing also makes it much simpler to check fees, investment practices, fund flow and balance sheet information and general administrative and compliance practices.
Users can also create watch lists of funds and/or managers they want to track, and receive e-mail notification when new information has been filed with the SEC. Perhaps most useful to mutual fund industry executives is the summary of new fund filings that is updated daily and includes a full summary of pertinent data, in a much more user-friendly format than EDGAR provides.
The Web page also offers hyperlinks to mutual fund company Web sites, with the most recent prospectus available for a fund, right down to the actual layout and graphics of that prospectus.
The Fund Filing system is offered through a corporate license that starts at $6,000 per year for six users. An individual user license for open- and closed-end mutual funds is available for $3,000 annually.
A preview of Fund Filing can be found on the Internet at www.fundfilingdemo.com.
Murray Johnstone taps Calvert for social screens
EDINBURGH, Scotland -- Murray Johnstone International hired the Calvert Group, Bethesda, Md., to provide a social screen for a new fund it launched at the beginning of this month, the Murray Ethical World Fund.
Calvert is providing Murray Johnstone with social research and analysis on stocks worldwide, concentrating on finding companies that meet high standards on labor, human rights, environmental, weapons and community relations issues.
Calvert, most famous as a manager of socially responsible investments, itself hired Murray Johnstone in 1992 to subadvise the Calvert International Equity Fund.
Whitridge retires from value fund
KANSAS CITY, Mo. -- Roland "Nick" Whitridge retired as manager of the $1.3 billion Babson Value Fund, which he had managed since its inception in 1984. Mr. Whitridge is retiring for health reasons from Jones & Babson Inc.
Tony Maramarco, senior vice president, is replacing Mr. Whitridge as the fund's manager.
Mr. Maramarco also will replace Mr. Whitridge as manager of the value components of the largely quantitative Babson Shadow Stock Fund, which has about $47 million under management. Catherine Ryan will continue to assist with management of the fund. Lance James, who also helped manage the Shadow Stock Fund, now will concentrate on managing the two small-cap funds he also oversees.
Security Benefit Group shifts lineup
TOPEKA, Kan. -- Security Benefit Group made several changes to investment management offerings this spring.
Bankers Trust Co., New York, was hired to manage the Security Capital Preservation Fund, a stable value mutual fund. Bankers Trust also was hired to subadvise the Security International Fund and the Security Enhanced Index Fund, both available through the company's variable annuity programs.
Wellington Management Co., Boston, was hired to replace Lexington Management Corp., Saddle Brook, N.J., as the subadviser of the Global Strategic Income Series. Wellington also replaced Lexington as subadviser of the Global Total Return Fund.
Vanguard reopens Windsor after 10 years
MALVERN, Pa. -- As expected, the Vanguard Group reopened the Vanguard Windsor Fund to new investors June 1, with a second subadviser, Sanford C. Bernstein & Co. Inc., New York.
Wellington Management Co., Boston, will continue to manage the bulk of the fund's $18.4 billion.
The Windsor Fund was closed in May 1989 because of high cash flows, Vanguard officials said in a statement.
Prudential adds sector funds
NEWARK, N.J. -- Prudential Investments added three sector mutual funds to its lineup: the Prudential Health Sciences Fund, the Prudential Technology Fund and the Prudential Financial Services Fund.
The investments of each of the fund are made entirely in a single industry and each is divided into two management styles. Half of the assets are actively managed in a concentrated portfolio of between 20 and 40 stocks. The other half of the assets are managed in an enhanced index composed of stocks in the focus industry selected from the S&P SuperComposite 1500 Index (which combines the S&P 500, 400 and 600 indexes).
Susan Hirsch and Jeff Rose manage the active part of the technology fund, and Ted Lockwood manages the quantitative portion. Kathleen McCarragher and David Chan manage the active portion of health sciences fund, and John Van Belle manages the passive portion. Patrick J. O'Brien manages the active part of the financial services fund and Mark Stumpp, the passive part.
INVESCO shareholders OK changes in 11 funds
DENVER -- Shareholders of INVESCO Funds Group approved the merger of some funds within its mutual fund family and closure of three others. Company officials said the moves will narrow its lineup to 32 funds.
The Small Company Value Fund was merged into Small Company Growth; Asian Growth into the Pacific Basin Fund; European Small Company into the European Fund; International Growth into International Blue Chip; Multi-Asset Allocation into Balanced; Short Term Bond into Select Income; Intermediate Government Bond into U.S. Government Securities; and Tax-Free Intermediate Bond into Tax-Free Bond Fund.
The Environmental Sciences, Worldwide Capital Goods and Emerging Markets funds were closed.
Forward launches real estate fund
SAN FRANCISCO -- Forward Funds Inc. launched the Forward Real Estate Investment Fund and hired Uniplan Inc., Milwaukee, as the fund's subadviser. Uniplan seeks income and capital appreciation through investment in both real estate stock and units of real estate investment trusts, as well as in real estate operating companies.
Separately, the Forward Funds added an institutional share class to its Small Capitalization Equity Fund, launched in October.
Morgan Stanley introduces new site
NEW YORK -- Morgan Stanley Dean Witter Investment Management introduced a Web site that offers comprehensive information about the more than 50 investment products it manages, including a family of institutional mutual funds.
The Web site's address is: www.msdw.com/institutional/investmentmanagement.
The new site is linked to the page of its parent company, Morgan Stanley Dean Witter, and among the site's comprehensive offerings is information about daily valued NAVs, historical and current performance data and portfolio characteristics and information on defined contribution services