Products April 14, 2009

Absolute Return Manager Launches Investment Platform

ETF Portfolio Management (ETF PM) launched a new investment platform.
Reported by
The firm, which describes itself as a specialized absolute return manager, has launched an investment platform that the firm said “combines active absolute return strategies with strategic core portfolios in an effort to maximize return and client value.”
Absolute Return Strategies
ETF PM’s absolute return strategies seek to deliver positive returns in all market environments without using leverage, according to a news release. The firm’s investment focus is to provide dynamic risk control, efficient portfolio rotation, and global diversification in a comprehensive solution for active management. All of ETF PM’s strategies are offered in separately managed accounts that are held in custody at Schwab Institutional and invest in securities with daily liquidity and full transparency, the firm said. The benchmarks for the firm’s active strategies are the Credit Suisse—Tremont Hedge Fund Index and the S&P 500.
ETF PM said it offers three passive core growth portfolios online:
  • Unconventional Core—a portfolio modeled after the recommendation from David Swensen, CIO at Yale University, in his book, Unconventional Success.
  • Basic Core—a portfolio offering a larger allocation to foreign stocks and commodities, and a smaller allocation to real estate.
  • Advanced Core—ETF PM’s passive growth portfolio with the largest exposure to commodities and emerging markets, and lower exposure to U.S. equities.

ETF Portfolio Management (ETF PM), with offices in New York and California, said its quantitative rules-based strategy was first implemented in 2005 at a previous firm, and expanded in 2008 to include four investment models.

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More information is available online at www.etfpm.com.

 

Data & Research April 14, 2009

Workers Shaken, but Remain Committed to Retirement Savings

Despite experiencing declines in both account balances and confidence, workers are still committed to saving for retirement, according to a new report.
Reported by
The vast majority of workers (91%) value a company-sponsored retirement plan, such as a 401(k), as an important employee benefit, and most continue to take advantage of their availability. Plan participation remains high (at 78%), as does median annual salary contribution (7%) for workers who are offered such a plan, according to the 10th Annual Transamerica Retirement Survey, conducted by the Transamerica Center for Retirement Studies. By and large, workers are also resisting the urge to tap into their retirement savings. In the last 12 months, only 6% reported having taken a loan and only 3% indicated that they had taken a hardship withdrawal from their accounts.
This commitment remains in place despite the reality that more than half of the workers surveyed (53%) indicated that their employers have already implemented layoffs or downsizing, froze salaries, eliminated bonuses, and/or reduced employee benefits. More than three-quarters of workers shared that they expect the economy to get worse (46%) or stay the same (31%) over the next 12 months.
Toll “Take”
That environment has taken a toll on worker’s retirement confidence: 57% of workers are less confident in their ability to achieve a financially secure retirement than they were 12 months ago, and only one in 10 are now “very confident’ that they will be able to fully retire with a comfortable lifestyle.
More than a quarter (29%) expect to work longer and retire later than they did 12 months ago, and more than one-third of workers (37%) now expect to work past the age of 70, including 15% who do not plan to retire.
Less than one in four (38%) agree that they are building a large enough nest egg, although 68% say they do not know as much as they should about retirement investing. Very few (8%) claim to have “a great deal” of understanding of asset allocation principles related to retirement investing, and a surprisingly robust 17% are not sure how their retirement savings are invested. More than half of the survey respondents (56%) indicated that they would like more information and advice from their employers on how to reach their retirement goals.
“Primary” Colors
Asked what they expect to be their primary source of income to cover living expenses when they retire, those who are offered an employer-sponsored 401(k) or similar plan most frequently cited 401(k), 403(b) accounts, and independent retirement accounts (IRAs) (51%). Those workers who are not offered a 401(k) or similar plan most frequently expect to rely on Social Security (32%).
Workers who are offered a retirement plan are also more likely to save for retirement outside of work (68%), compared to those who are not offered a plan (50%).
This survey was conducted online within the United States by Harris Interactive on behalf of Transamerica Center for Retirement Studies between December 16 and January 13, among 3,466 full-time and part-time workers. Potential respondents were targeted based on job title and full-time and part-time status.

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