New CEO at Morningstar
From Wall Street Journal
A shakeup is underway at Chicago fund tracker Morningstar. The paper reports that Don Phillips has stepped down as chief executive and been replaced by founder and chairman Joe Monsueto. Initially, Monsueto had asked Phillips to trade roles, an offer that Phillips declined, though Phillips added that there was no feud or power struggle. The paper also quotes on Morningstar executive as saying "Don is Morningstar." Monsueto will reportedly make controlling costs his initial focus. Also losing a title is president Timothy Armour, who like Phillips becomes a managing director. Rising is Tao Huang, who had run Morningstar's international businesses. He takes the newly created role of chief operating officer. The paper also reports Morningstar's revenues as hitting $69 million for this year, short of the $71 it had expected, but well up from $51 million in 1999. The firm will restructure into seven business units, with the online Clear Future retirement-planning service taking a leading position.

Fund Firms Top Fund Picks
From Investor's Business Daily
The stocks of firms have been outperforming the funds themselves. The paper reports that Alliance Capital stock is up 71.5% this year while its domestic stock funds had gained just 0.62%. Federated Investors shares are up 125.3%, while its funds are down 8.96% and Legg Mason shares gained 33.8% against a 2.29% in its stock funds. The most extreme case is Neuberger Berman's stock price that is up more than 200% against a 0.5% gain for its equity funds.

Private Equity for 401k Investors
From Financial Times
US fund managers want to give defined contribution plan investors access to private equity investments, reports the London paper. It reports that the Washington-based Carlyle Group, has held two meetings with Fidelity Investments, to discuss was to let 401(k) investors into private equity funds.

ETFs Just a Wrinkle
From Barron's
Barron's take a look at whether fund alternatives such as exchange-traded funds and personnel funds are winning products. It says ETFs are "really just a wrinkle on index funds, with a slightly different set of benefits and drawbacks." It bases its opinions on research by Needham, MA-based TowerGroup's research.

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