Tag Archives | index funds

CII: Index Providers Speak

Index Providers Speak: Policy Process and Voting Rights

Index providers spoke at  about how they develop their policies. Specifically, they discussed recent developments around voting rights.

Index Providers Represented

  • Annalisa Barrett, Clinical Professor of Finance at the University of San Diego (Moderator)
  • David Blitzer, Managing Director & Chairman of the Index Committee, S&P Dow Jones
  • Pavlo Taranenko, Executive Director, Index Research, MSCI (standing in photo)

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Jack Bogle on Diversified Portfolios vs Speculation

Jack Bogle

Jack Bogle

Buying and holding stocks and bonds for the long term and maintaining a diversified portfolio are still the smartest strategies for the average investor, says Vanguard founder Jack Bogle in answer to Mark Cuban and other critics of these traditional approaches. In the Big Interview with Journal columnist Jason Zweig, Bogle takes aim at the culture of market speculation. Betting on long odds, he says, “doesn’t pay off very often.” Continue Reading →

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Corporate Governance: Stepping Back in Time From October 2013

MrPeabodysWayBackMachinePublisher’s Note: Yes, you’ll find many broken links in the material referenced below. After 5, 10 and 15 years, the internet moves on. Many of the organization’s linked have since gone under. We’re just glad to still be here, offering our readers a sense of the history we have shared. More about the WABAC machine.

Five Years Ago in Corporate Governance

  • The Treasury is injecting $125 billion into nine big banks and making a like amount available for other banks that apply. Those financial giants owed their executives more than $40 billion for past years’ pay and pensions as of the end of 2007, a Wall Street Journal analysis shows. (Banks Owe Billions to Executives, 10/31/08) How much of our $250 billion bailout will go to pay for special executive pensions and deferred compensation, including bonuses? Will our disgust with those who brought us the financial melt-down lead to an upsurge in mutual banks and credit unions?
  • Jackie Cook, the founder of Fund Votes, told SocialFunds.com, “Executive compensation is at the heart of a growing problem Continue Reading →
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ETF's: Danger or Positive

The factors that brought about the tech bubble, the collateralized debt obligations crash and the rest are being replicated with ETFs: floods of cash and tidal surges of ingenuity in the markets advancing faster than the regulators’ event horizon.

via Fair exchanges?, Inside Investor Relations, 6/29/2011

‘ETFs, indexes and ‘closet indexers’ among mutual funds already make up about 40 percent of the market, I’m told that if you get up to about 60 percent, there really is no market anymore,’ Bob Monks points out. Others disagree. Additionally, Jon Lukomnik says ‘indexes provide active ownership discipline: where you can’t use exit, you use voice.’

See the FSB five page advisory report entitled Potential financial stability issues arising from recent trends in Exchange-Traded Funds (ETFs) found through Why ETFs give an uneasy sense of déjà vu, ft.com, 5/5/2011.

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Video Friday: John Bogle on Index Funds & Corporate Governance

Bogle sees Index Funds, which hold 25% of all stock, as the best hope for governance. However, he acknowledges free rider problem, potential conflict of interests for offending clients. Hopes we will gradually break down the barriers. These are the funds that have held for three years or more, so these are the funds that will have proxy access.

Bogle would like funds to introduce resolutions requiring 75% of shareowner vote in order to make political contributions. They should vote in the interest of their shareowners, not their managers. Corporations shouldn’t be controlled by their agents.

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