Analysts And Insurers Say Funds Are Rebounding From September Dip

GE Value Equity, U.S. Equity, and Premier Growth have all shown respectable returns over the long haul, Curtis says, even though, in the past year, like most funds, their rate of return has declined. GEs Small Cap Value has returned about 4.7% in the past 12 months, according to Barrons.

In general, insurer-sponsored funds have been telling financial advisors to remind their reluctant clients that theyre not in mutual funds to get rich quickly.

“Weve tried to get the word out to advisors and investors to focus on long-term goals and results, even more so because of Sept. 11,” says Gregg Stitt, spokesperson for Oppenheimer Funds, the New York-based subsidiary of Massachusetts Mutual Life Insurance Company in Springfield, Mass.

To equip its advisors to handle customer concerns, Oppenheimer has added new training modules to its Web-based educational package for producers, known as Client Connect.

“We added after 9-11 Managing Through Tougher Markets, which discusses different ways to help advisors support clients,” says Stitt. “It touches on issues other than strictly investing concerns–the after-effects of traumatic experiences, such as stress, fear, anxiety, depression–because how people react to these events might affect difficult investment decisions.

“Were just trying to point out to advisors what they need to tell investors to make sound decisions, to come up with the best solution to their financial needs going forward,” Stitt says. “We didnt change our message, just reinforced it.”

State Farm Life Insurance Company in Bloomington, Ill. says it has not seen an adverse impact on sales of its funds, primarily because they are relatively new and hence are still in a fast-growth stage. The company introduced its line of funds to its agents in March, offering three types of equity index funds, a balanced fund, two bond funds and a money market fund.

Following the events of Sept. 11, “we reached investors and agents through internal communications and our Web site,” says Kris Dunne, a company spokesperson.

State Farms marketing unit provided agents with additional materials, including a chart that outlined the recovery of markets after certain catastrophic events in the past, such as Pearl Harbor, and the Gulf War.

“We also had a team prepared to handle concerns from investors or agents, but by and large, they did not have any,” Dunne says.

“One of the important things to remember is where our philosophy is,” she observes. “Its about long term investing. Our securities products were selected with that in mind.”

Many fund managers believe the market is on the brink of a rebound and are acting accordingly, reports Rosanne Pane, mutual fund strategist for Standard & Poors, New York.

Stocks that might benefit the most from a bull market include semiconductors, telecommunications and other technology areas where good stocks are available relatively cheaply, along with some cyclical industries, such as retail, she adds.

“For the last few weeks, fund managers have anticipated a recovery, and I hear they are repositioning their portfolios for a recovery, which they expect early next year,” she says. “Were beginning to see acceptance in the industry that there will be a substantial monetary and fiscal rebound.”

Reproduced from National Underwriter Life & Health/Financial Services Edition, December 17, 2001. Copyright 2001 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.

Copyright 2001 by The National Underwriter Company. All rights reserved. Contact Webmaster