Merrill Drops financial plan sales quota
From Wall Street Journal
Merrill Lynch & Co. will no longer require its financial consultants to sell a minimum if 10 of its Financial Foundation financial plans per year. The decision to drop the requirement was made by E. Stanley O'Neal, who took over Merrill's brokerage unit early this year from John "Launny" Steffens. The firm emphasizes that financial consultants will still be conducting financial planning since that is a core part of what they do.

Spencer Trask draws investor ire
From New York Post
New York-based venture capital firm Spencer Trask has been aggressively pursuing financial advisors and their clients as it raises money for its fund. Its efforts included taking a booth at last year's Schwab Impact conference. Now the firm is under fire from investors who claim that its senior executives are keeping the best deals for themselves. Kevin Kimberlin, who was formerly an executive of the scandal-plagued Wall Street firm D.H. Blair, is Chairman of the firm. "The clients don't get the best deals," millionaire investor told The Post. Altogether, the paper claims that it spoke to six investors. The paper says three deals in which Kimberlin was an investor but in which Angel investors were not allowed to invest were: Ciena Corp., Next Level Communications and SmartServ Online. The firm touts the Ciena deal on its website even though none of its investors were allowed in on the deal. Investors are also upset that Kimberlin has been sold stock in deals at a lower price than Spencer Trask investors.

Fund companies eye hedge funds
From Chicago Tribune
Fund companies are hot for hedge funds. According to the paper, "mutual-fund companies are doing everything they can to get in the hedge-fund game." Why? It is a way "to hold onto both increasingly wealthy investors and to increasingly mobile money managers." The paper reports that no less than 15 fund managers, including seven whose portfolios returned more than 100% in 1999, have moved to manage hedge funds so far this year. Hoping to staunch the flow fund companies are launching their own hedge funds. Companies taking this route include: Montgomery Asset Management, Barr Rosenberg Mutual Funds, and Lindner Asset Management among others.

Retaining shareholders gains importance
From Wall Street Journal
Fund companies are starting to play defense. After years of growing by acquiring new investors fund companies are paying more attention to the ones that they already have. Dreyfus turned to a publishing executive from Time Warner -- Prasanna Dhore - to develop ways for it to keep shareholders. Other fund companies are hitting investors who leave with a redemption charge. More than 130 stock funds have added redemption fees since 1997, according to Lipper Inc. Fidelity Investments also tries to woo customers. It spends nearly half its marketing budget keeping clients in the fold Neal Litvack, head of retail marketing, is quoted as saying. Vanguard Group, of course, is offering long-term shareholders a change to convert to low-cost Admiral shares. Broker-sold fund companies such as Scudder Kemper Investments, OppenheimerFunds and Putnam Investments are compensating brokers based on their success in retaining investors.

Marsico, Goff share words over URL
From New York Times
Last week this space reported that Janus had registered TomMarsico.com (see But they don't own JanusSucks.com). It seems Marsico didn't know his name had been swiped. Today the New York Times reports that he is fighing for the return of his name from Janus fund manager James P. Goff. Goff admits that he registered the URL last December on his own behalf "just for kicks." Marsico, isn't buying it. "When people go out and buy domain names like that, they're usually trying to do it for some benefit, selling it for a higher price," he told the Times. "I was dumbfounded." Goff says that he offered to return the name when the two recently met in a buffet line at a country club to which they both belong. 

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