Compliance December 28, 2010

IRS Corrects Hybrid DB Plan Rule

Federal officials have issued a corrected document on final regulations for hybrid defined benefit plans since a previous version contained errors “that may prove to be misleading and are in need of clarification."
Reported by

The Internal Revenue Service corrections for TD 9505 were contained in a document published Tuesday in the Federal Register that become effective immediately and applicable on October 19, 2010 when the original version was first published (see IRS Issues Rules on Hybrid Retirement Plans ). 

The corrections to the Hybid Plan rules are at http://origin.www.gpo.gov/fdsys/pkg/FR-2010-12-28/pdf/2010-32539.pdf .

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Further information is available by calling Neil S. Sandhu, Lauson C. Green, or Linda S.F. Marshall at (202) 622–6090.

The Markets December 28, 2010

Financial Services Takes Lead in Russell 3000 Weighting

The U.S. broad-market Russell 3000 Index began the decade with technology as the most heavily weighted sector, but now the financial sector has emerged as leader.
Reported by

As of December 29, 2000, the technology sector comprised 20.2% of the Russell 3000, but as of December 27, 2010, it had dropped to second place.  Financial services ranks first with a 17.3% weight as of December 27, 2010, according to a press release, while the materials and processing sector in the Russell 3000 continues to hold the lowest weighting (December 29, 2000: 2.9%, December 27, 2010: 4.8%).  

In developed markets outside the United States, as reflected by the Russell Developed ex-U.S. Index, financial services also ranks as the most heavily weighted sector, reflecting a weight of 24% as of December 27, 2010, as it did at the end of 2000. Technology (December 29, 2000: 12.8%, December 24, 2010: 6%) and utilities (December 29, 2000: 13.2%, December 27, 2010: 7.9%) have seen their weightings decrease significantly since the start of the current decade.   

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Technology holds the lowest weighting in the Russell Developed ex-U.S. Index (6%). 

 
 Russell 3000 Index Russell Developed ex-U.S. Index 
Russell Index Sectors Sector Weights December 29, 2000  Sector Weights December 27, 2010 Sector Weights December 29, 2000  Sector Weights December 27, 2010 
Technology20.2%  16.7% 12.8%  6.0% 
Health Care14.8% 11.2%7.1% 6.6%
Consumer Discretionary12.0% 13.0%13.6% 10.8%
Consumer Staples6.3% 8.0%5.1% 8.2%
Energy6.3% 11.1%6.7% 9.6%
Materials & Processing2.9%  4.8% 9.0% 14.5%
Producer Durables8.8% 12.0%8.9% 12.4%
Financial Services19.8% 17.3% 23.5%  24.0% 
Utilities8.8% 5.9%13.2%  7.9% 

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