Fund managers who walk the talk
The majority of mutual fund managers “don’t have a dime” in their own funds, said Kathleen Pender in the San Francisco Chronicle. That’s bad news because, at least “theoretically, managers who have large, or at least some, personal stakes in their funds will be inclined to act in the best interests of shareholders.” Among big fund companies, American, Janus, T. Rowe Price, and Dodge & Cox have high levels of manager ownership. Federated and DWS Scudder are notable examples at the other end of the spectrum. “You have to wonder about a manager who can’t even cough up five grand to put into his or her fund.” Details of ownership for 500 funds are at Morningstar.com.
Copper is a hot commodity
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“Property owners, it turns out, do not watch the commodities market as keenly as druggies do,” said Rebecca Winters Keegan in Time. Since 2003 the price of copper has quadrupled to $4 a pound, making it a hot item among thieves: Houses nationwide have been plundered for copper plumbing, air conditioners, sprinklers, rain gutters, and even lawn ornaments. Lawmakers are “looking to crack down on copper thieves” by requiring people to show ID when they sell the metal at scrap yards. In the meantime, homeowners should make sure the copper in their homes and yards isn’t easy to grab. “People think of copper as cheap, like sand,” says Charlie Sidoti of OneBeacon Insurance Group, which estimates that there has been a 300 percent jump in copper theft over the past year and a half. But you should treat it like gold. “You would never leave gold sitting out in the yard,” Sidoti says.
Investing in your backyard
Investors often put too much of their portfolio into companies based in their own home state, said Mark Hulbert in The New York Times. “Faced with the daunting task of choosing among thousands of publicly traded companies, investors turn to companies with which they are familiar.” George M. Korniotis, an economist with the Federal Reserve, and Alok Kumar, an assistant professor at the University of Texas, Austin, recently studied stock holdings from 1991 to 1996 of more than 75,000 individuals. They found local bias among investors in all 50 states. Some investors now speculate that companies’ shares can rise in value merely because their local state economy is doing well, and local investors can put more money into stocks. By the same token, the stocks might fall for no other reason than that local investors are squeezed for cash.
