Are Large Cap Gains Payout Becoming a Black Eye?
From Smart Money
More publications are picking up on the recent spate of outsized fund taxable capital-gains distributions. They are also noticing that some of the shareholders taking the hit were unfortunate to be in a fund with a negative return. This article cites the now infamous case of Warburg Pincus Japan Small Company fund, is down 44.6 percent and made a 55 percent capital-gains distribution. Another payout mentioned in the article is the 37 percent distribution from the Merrill Lynch Utilities & Telecommunications fund. The report also makes the case for exchange-traded funds as a way to avoid these distributions.
Invesco To Shutter Two Funds
Invesco Funds Group is quietly liquidating two regional funds. Both funds lack assets and performance. They are the $64 million Pacific Basin Fund and the $26 million Latin American Growth Fund. The revelation was made in a preliminary proxy statement filed Wednesday. According to the filing: "These geographic regions have been weak and volatile for an extended period of time. While there may be solid values still to be found in the emerging economies, our research has found that the narrow geographical focus of these funds has resulted in increased volatility, and the funds have not found favor with our investors or the investing public in general."
Software is The Next HOLDR
Riding the popularity of fund-like derivative products, Merrill Lynch is readying more HOLDRs. The new security will invest in the 20 largest software stocks. The new security will be the twelfth offered by the brokerage firm and will trade under the symbol "SWH".
MFS Loves Tech
From Investor's Business Daily
The MFS fund family beefed up its stakes in Intel and Micron Technology, according to reports. To make room for the holdings it shed "a large amount" of Oracle, which remained the group's largest position. In absolute terms, General Electric was the group's largest buy in the second quarter.
Are Bond Funds Back?
From Wall Street Journal
What is old is new again. The Journal
points out today that bond funds can help cure stock market volatility. Who knew? The paper reports that the key to picking bond funds is to "keep costs down." Funds failing to do this, says the paper, are: Putnam Income Fund's M share class, and Eaton Vance National Municipal Bond Fund's B shares. On the flip side, recommended funds include: low-cost bond funds from Vanguard, active funds from Thornburg Management.
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