In Practice September 26, 2007

PA NC: Powerful Presentations

Knowing the audience and customizing presentations for specific participant groups are the keys to having an effective participant meeting, according to a panel of industry professionals at PLANADVISER’s National Conference 2007 in Orlando, Florida, this week.
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“That is the key to a powerful presentation: know your audience,” said panel member Janet L. Ganong, Financial Consultant at The Kieckhefer Group of RBC Dain Rauscher. Ganong suggests advisers look at the plan material of the plan sponsor and customize it for the presentation. She also said “simple is impactful,” and that advisers should offer their services on an individual basis to participants before and/or after the meeting.

Chad Larsen, SVP Retirement Services of Moreton Financial Solutions, LLC, an NRP Member Firm, pointed out that he thinks the most important thing is to know what the sponsor is looking for from the presentation. He also suggests segmenting employees into demographic groups and hosting different meetings. An adviser can focus on what will really matter to, and make a difference for, participants if they are segmented into groups according to whether they are already in the plan or not, or whether they are approaching retirement, Larsen gave as examples.

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Panel member Joe Frustaglio, VP, National Sales Manager of Nationwide Financial, suggested segmenting employees based on their investment personality – whether they are “do it myself” or “do it for me” investors. From a vendor standpoint, Frustaglio said he uses fund partner presentation materials in participant meetings.

“I’m not convinced the content really matters,” offered Larsen. “I think it’s all in the presentation and commitment of the people giving the presentation.”

Larsen said, instead of a presentation, many employees just need help with the paperwork. He also suggested making the meeting fun for employees. “If they walk off and they haven’t laughed, we’ve failed,” he said.

The Markets September 25, 2007

Money Fund Managers Concentrating on Safety Says S&P

A new Standard and Poor’s study found that money fund managers are concentrating on safety and liquidity and downplaying yield.
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An S&P news release said the report, “Money Market Funds Intensify Their Focus On Safety And Liquidity,” found that many managers have put internal restrictions on the purchase of commercial paper offered through collateralized debt obligations (CDOs) and commercial paper offered out of structured investment vehicles (SIVs).

However the study did admit that, as the market has shown recent signs of stabilizing, several fund managers have again started buying certain commercial paper instruments.

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“There’s been a flight to quality in reaction to recent market volatility,” observed Joel Friedman, director in Fund Ratings and Evaluations at Standard & Poor’s. “For about the past month, portfolio managers have not invested in many asset-backed securities, and almost all had stopped buying extendible asset-backed commercial paper (XABCP), where the issuer has the option to extend the maturity to a final predetermined date if it cannot repay the maturing debt.”

In the U.S., the popularity of the safest, and lowest-yielding, instrument -Treasuries- has increased significantly. Following close behind are agency discount notes (from the Federal Home Loan Banks and Freddie Mac, for example), highly rated short-term corporate debt, bank deposits, and overnight repurchase agreements backed by Treasuries and agencies, the study said.

Liquidity isn’t easy to measure, and it’s become even more difficult in the currently volatile market-price environment, S&P said, so managers and investors are now weighing the risks of higher returns against the safety of more liquid and conventional securities.

The report is available to subscribers of RatingsDirect, at www.ratingsdirect.com or can be purchased by calling 212-438-9823.

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