Macro hedge funds have seen success in their increasing short positions on the Chinese yuan, but they say such activity is for various reasons and not because an economic crash in China is seen as likely. Short-selling can be costly, as the practice has left funds exposed to sharp rises in overnight funding costs within the past year.
An eVestment report shows slightly more than half of reporting hedge fund strategies had returns averaging 5.3% in the first half of 2018, while the rest were down 5.3% on average. Overall returns were at negative 0.51% in June, although returns year-to-date are positive overall at 0.16%, the report says.
Hedge funds are bearish on New Zealand's currency, with data from the Commodity Futures Trading Commission showing that they have increased net-short positions for three consecutive weeks. The country is reporting second-quarter inflation figures on Tuesday, and economists expect to see an annual rate of 1.6%.
Global regulators have laid out a framework for keeping tabs on potential risks in the market for cryptocurrency assets. "The use of leverage, and financial institution exposures to crypto-asset markets are important metrics of transmission of crypto-asset risks to the broader financial system," the Financial Stability Board noted.
The number of 401(k) plans offered by small businesses rose to 8,873 last year, compared with 1,418 in 2013, according to the Vanguard Retirement Plan Access report. Jean Young, author of the report, says she expects professionally managed allocations such as target-date funds to be increasingly used in the small-business marketplace.
One of the most compelling reasons to invest in companies that put an emphasis on diversity is that evidence shows diverse teams are more creative and more likely to reach short- and long-term goals, writes Betsy Moszeter, chief operating officer of Green Alpha Advisors. She adds that firms can give themselves a competitive boost by bringing on diverse employees and "giving them ample support and influence."
Two major US annuity issuers, Nationwide Advisory Solutions and Great American Life, have launched web-based tools for registered investment advisors and their clients that offer the ability to run Monte Carlo simulations. Nationwide's platform includes tax deferral and annuity comparison calculators, while Great American's platform focuses on indexed annuities.
A report from Mercer showed the funding level of S&P 1500 company pension plans was unchanged in June because of an increase in discount rates, but offset by declines in international equity markets. With discount rates moving steadily higher, the option of transferring pension liabilities from company balance sheets to annuities is becoming more attractive, said Mercer's Scott Jarboe.
The Securities and Exchange Commission said its Office of Compliance Inspections and Examinations has found widespread failure by advisors to comply with their obligation to obtain the best execution for clients' transactions. The alert also said failure to disclose soft-dollar arrangements is an issue.
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