Newsdash Insight on Plan Design & Investment Strategy from PLANSPONSOR
November 24th, 2014
From the Magazine
Saxon Angle: Rollover Scrutiny Intensifies
Individual retirement accounts (IRAs) are now the largest retirement savings system in the U.S., with total assets of over $7 trillion. Rollover contributions from employer plans to IRAs average more than $300 billion per year, and we expect that this trend will continue. With this large reserve of assets and massive volume of transfers, IRAs have been subject to scrutiny from multiple government agencies. As evidenced by the progress—or lack thereof—of the Department of Labor (DOL)’s proposed fiduciary regulation, as well as DOL Advisory Opinion 2005-23A, it is clear that the department has been focusing on rollovers from qualified plans to IRAs for some time.Read more >
Sponsored message from The Newport Group
Newport #1 in “Best in Class” Awards in 2014 PLANSPONSOR DC Survey
The Newport Group, a national provider of retirement and executive benefit plans, is #1 in “Best in Class” awards in PLANSPONSOR magazine’s 2014 Defined Contribution Survey. Newport earned a record 72 awards-more than any other provider in the retirement industry.Read more >
Products, Deals & People
Mercer Boosts Alternative Investments Presence
Mercer said it has agreed to acquire SCM Strategic Capital Management AG, a Swiss-based specialist private markets adviser and delegated solutions provider. The acquisition will further strengthen Mercer’s capabilities in alternative investments, an area of growing importance in the global institutional marketplace.Read more >
Callan Associates will use RiskFirst’s pensions risk analytics platform, PFaroe, to help institutional investors conduct asset allocation and asset/liability studies.Read more >
Webcast Event
A number of core bond funds seem to have boosted their total returns by dipping lower in credit quality—potentially adding considerable amounts of high-yield debt to retirement plan portfolios. Join us for a live, interactive webcast, in which you will find out how to avoid the risk of unintended asset class exposure to high-yield debt; identify and select a true core bond strategy; and position core bond effectively in retirement plan portfolios.Read more >
Economic Events
THE ECONOMIC WEEK AHEAD: Tomorrow, the Conference Board will issue its Consumer Confidence Index for November. Wednesday, the Labor Department will issue its initial claims report, and the Census Bureau will report about durable orders and new home sales for October.
Market Mirror
Friday, the Dow closed 91.06 points (0.51%) higher at 17,810.06, the NASDAQ was up 11.10 points (0.24%) at 4,712.97, and the S&P 500 climbed 10.75 points (0.52%) to 2,063.50. The Russell 2000 increased by 1.67 (0.14%) to 1,172.42, and the Wilshire 5000 gained 103.31 points (0.48%) to 21,696.14. On the NYSE, 3.2 billion shares changed hands, with advancing issues outnumbering declining issues more than 2 to 1. On the NASDAQ, 2.8 billion shares traded, with a slight lead for advancers. The yields for the 10-year Treasury note and 30-year Treasury bond were 2.311% and 3.018%, respectively. WEEK’S WORTH: For the week ending November 21, the Dow closed 0.99% higher, the NASDAQ was up 0.52%, and the S&P 500 climbed 1.16%. The Russell 2000 slipped 0.12%, and the Wilshire 5000 gained 1.06%.
Credit Suisse Can Continue as QPAM
Credit Suisse AG has received temporary approval to continue acting as a qualified professional asset manager (QPAM), after pleading guilty to criminal charges related to client tax evasion. The bank applied in July for an exemption from the Department of Labor’s (DOL) Employee Benefits Security Administration (EBSA) to keep its status as a qualified professional asset manager. The QPAM exemption allows asset managers to engage in transactions with parties in interest with respect to retirement plans without running afoul of the prohibited transaction restrictions of the Employee Retirement Income Security Act (ERISA) or the Internal Revenue Code.Read more >
School District Settles Retirement Plan Age Bias Suit
A Phoenix, Arizona, school district has settled an age discrimination suit with the Equal Employment Opportunity Commission. In EEOC v. Murphy School District No. 21 (CV 14-00721-PHX-SRB), filed in the U.S. District Court for the District of Arizona, the EEOC alleged that since at least 2008, the school district has engaged in unlawful employment practices by utilizing a policy titled “Retirement of Professional Staff Members.” The EEOC said the early retirement incentive plan discriminated based on age by providing for older employees to be compensated at lower rates than are paid to younger employees.Read more >
Major changes are occurring in the fixed-income markets that are driving asset managers to position clients against volatility and future rate tightening, according to Cerulli Associates. The November 2014 issue of “The Cerulli Edge – U.S. Monthly Product Trends” examines ongoing fixed-income investing developments and finds institutional investors, including employer-sponsored retirement plans, are increasingly considering unconstrained and absolute return fixed-income strategies.Read more >
Small Talk
ON THIS DATE:  In 1859, “On the Origin of Species by Means of Natural Selection,” by British naturalist Charles Darwin, was published in England. In 1874, Joseph F. Glidden was granted a patent for a barbed fencing material. In 1903, Clyde J. Coleman received the patent for an electric self-starter for an automobile. In 1932, the crime lab that is now referred to as the FBI Scientific Crime Detection Laboratory officially opened in Washington, D.C. In 1963, in the basement of the Dallas police station, Lee Harvey Oswald, the alleged assassin of President John F. Kennedy, was shot to death by Jack Ruby, a Dallas nightclub owner. In 1993, the U.S. Congress gave its final approval to the Brady handgun control bill.
SURVEY SAYS: Holiday Parking Lot Behavior
Last week, I asked NewsDash readers, have you had a parking lot accident during the holiday season? What strategies do you use to find a parking space? And, have you confronted another driver or been confronted by another driver about parking? The good news is 85.4% of responding readers have not had a parking lot accident during the holiday shopping season. However, 4.9% reported they have hit a car, 7.3% said another car hit them, and 2.4% hit a pole. Asked what strategy they use for finding a parking spot in a crowded parking lot, 40.5% said they circle the lot and drive through the aisles to see what spots are available then decide which to go for, 31% reported they follow people with bags or shopping carts and wait for them to load and leave, and 2.4% “make” a spot at the end of rows or next to or straddling curbs. Twelve percent of responding readers have said something to another driver about bad parking or bad manners, and 8% admitted someone has said something to them about bad parking or bad manners. Twenty-four percent have made a hand gesture to another driver while driving away, and 16% have had someone else make a hand gesture to them while driving away. In verbatim comments, some readers suggested it wouldn’t hurt anyone to just park in the back of a lot and walk. Several noted that bad parking lot behaviors do not express the spirit of the season. Many said they just avoid all the bad moods and frustrations by shopping online. Editor’s Choice goes to the reader who said: “I love internet shopping. There’s always a spot to park myself, a shopping cart is always available, and the only accident I’ve ever had is leaving my wallet out of arm’s reach.” Thanks so much to all who participated in our survey!Read more >
Share the good news with a friend! Pass the Dash along – and tell your friends/associates they can sign up for their own copy.Read more >
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