AIG Looks to buy
From Wall Street Journal
Being a keynote speaker is not a way to douse rumors. Today's Journal features a piece on the speculation that American International Group Inc. (AIG) is in the market for a fund company. Speculation in part fueled by Maurice R. "Hank" Greenberg, chairman and chief executive of AIG by remarks he made at last month's Investment Company Institute General Membership meeting. The article also says that AIG officials acknowledge that they are examining possibilities. Which companies might catch his eye? The paper notes that Janus Capital Corp., majority owned by Kansas City Southern Industries, "meet the criteria" of consistent performance that AIG wants.

T. Rowe to sell through Salomon
From Wall Street Journal
T. Rowe Price Associates is the latest no-load fund company to sell its funds through brokers. Starting today it is distributing 10 of its funds through Citigroup Inc.'s Salomon Smith Barney brokerage unit�s 11,400 intermediaries. The funds will be sold as a part of the brokerage's TRAK Personalized Investment Advisory Service and AssetOne programs and will include annual fees.

The cost of churn
From Barron's
Currently nearly one quarter of fund assets are redeemed monthly. When measured as a percent of sales redemptions are up to 81%, according to the Financial Research Corp. Barron's points out that this churn is raising costs for investors and may lead toward more funds instituting redemption fees. The article also profiles closed-end fund company Adams Express.

Funds cool on China
From Wall Street Journal
Fund companies are taking a cautious stance on entering the Chinese market, despite the fact that 10 Chinese players offering a total of 25 funds have a combined $6 billion in Chinese bonds and stocks under management. Yet many fund companies seem "underwhelmed". "There's an awful lot of things that need to be wrapped up," Brett Goodin, Fidelity Investments' managing director in Hong Kong, is quoted as saying. "China's a very interesting market that we are certainly getting closer to in trying to understand. ... But there are still a number of unanswered questions." Among the problems: a requirement that foreign firms take minority stakes in joint ventures with local players; The lack of clarity in the fund-management agreement negotiated between U.S. and Chinese WTO negotiators last November over points such as whether joint ventures can market to both institutional and retail clients and whether they will be free to invest money in a broad range of stock and bond instruments.

ETF timers hold 3 days
From Wall Street Journal
At least six more fund companies are looking at adding exchange-traded funds (ETFs) to their line-up according to an article in today's Journal. The article also makes the point that consumers of ETFs may not be similar to fund customers. The average holding of the NASDAQ 100 ETF holds for only three days, according to statistics from Bogle Financial Markets Research Center quoted in the article.

Soros CEO quits
From Wall Street Journal
Duncan Hennes has resigned as chief executive of Soros Fund Management, according to the Journal. Hennes said that he is leaving due to George Soros' decision to change the aggressiveness of the hedge fund. "I was hired to expand the franchise and manage it, but right now George's priority is to manage his money -- expansion of the firm is secondary," said Mr. Hennes, formerly the treasurer of Bankers Trust Corp., in an interview. "This wasn't the role I wanted when I joined the firm, and George was good about my decision." Hennes' decision comes on the heals of resignations by investment manager Stanley Druckenmiller, manager of the Quota Fund Nicholas Roditi, and chief financial officer Peter Streinger.

Also of interest:

Eaton Vance's plain vanilla strategy is profiled by the Wall Street Journal
After-tax returns will be required for funds explains the Seattle Times
TheStreet.com found ten microcap funds that investors can still enter.
Money profiles Jurika & Voyles Nick Moore.

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