The Games People Play
Have you heard the expression "cooking the books?" Have you ever thought about what it really means or how it's done? Read this article for an interesting, plain language explanation. Enron would be proud!
Is Bugs Bunny Running DuPont?
Would you like a mutual fund with your stockings? That's what the folks at DuPont want to know. A wholly owned subsidiary of chemical giant E.I. DuPont de Nemours Company has launched a mutual fund. The folks who gave us Lycra, neoprene, nylon, Teflon, Kevlar and Tyvek will now give us investment products. Recently launched [...]
Risk Tolerance of Mutual Fund Shareholders’ Remains Muted Post-Financial Crisis
The most recent annual survey by the Investment Company Institute ("ICI") shows mutual fund shareholders' willingness to assume investment risk has not rebounded since the 2007/2008 financial crisis. John Sabelhaus, ICI Senior Economist and survey co-author noted, "Nearly all mutual fund-owning households reported being focused on retirement saving and three-quarters of them reported that as [...]
Is Homer Simpson a Fund Analyst at Morningstar?
Life is full of opportunities to teach to and learn from others. Recognizing these lessons is key to our growth and success. Is there truth to this? Maybe...or maybe it's our way of justifying the 30 minutes spent watching reruns of The Simpsons from its glory days. In the episode entitled "Homer the Vigilante" America's [...]
Mutual Fund Regulation Enters the 21st Century
Tired of amended and late-arriving 1099s delaying your tax returns? Help is on the way. The House of Representatives passed on Wednesday the Regulated Investment Company Modernization Act (H.R. 4337) marking the first regulatory update of mutual fund taxation in over 20 years. The most notable provisions permit mutual funds to earn income from commodities [...]
SEC Ignores Public’s Desire for Universal Fiduciary Standard
In our Sept 15th post we referenced an article highlighting the public's confusion over fiduciary standards. A new survey supports the idea that a single standard is warranted. Consider these findings from a recent Infogroup/Opinion Research Corp survey: 91% believe brokers should follow the same fiduciary standards as investment advisers 96% believe insurance agents should [...]
Survey Finds Investors Confused about Fiduciary Obligation
So who is and isn't looking out for the best interests of clients? Think it's your stockbroker? Three out of four Americans think so. Three out of four Americans are wrong. Find out more here.
News & Notes from Capitol Hill
Proposed legislation from our friends in the House and Senate: HR 5318 (The Small Business Investment Penalty Relief Act of 2010) would waive the 10% penalty on early distributions from retirement plans if the funds were used for small-business investments. The bill is similar to HR 3612 and HR 3390. S 3720 and HR 6099 [...]
I Know Something You Don’t Know
Insider buying and selling. Stock purchases and dispositions by people "in the know" as an indicator of where prices are headed. Good info? Maybe - maybe not. Far too many factors influence the validity of this indicator. Is an insider selling stock because s/he thinks it's overvalued or is s/he disposing of shares because an [...]
Fund Flows Confirm “Do As I Say and Not As I Do” Strategy
We humans are a curious bunch. Occasionally we say one thing but do another. Almost as often this gets us into trouble. We sing the economic blues yet restaurant parking lots are packed. We cry over crushing debts yet vote for spend-happy politicians. We claim to be long-term, risk averse investors yet we chase performance. [...]