Investing July 3, 2003

Event-Driven Hedge Fund Index Drives June S&P Returns

July 3, 2003 (PLANSPONSOR.com) - The S&P Event-Driven sub-index led the performance of the S&P Hedge Fund Index in June as the overall index gained 0.47% for the month, according to Standard and Poor's.
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S&P said in a news release that the June showing of its primary hedge fund index led to a 3.4% return for the previous three months and 5.96% year to date as of June 30. The S&P Event-Driven sub-index enjoyed a 1.43% June showing, a 6.42% return for the quarter and a 9.51% advance year to date.

Among the other sub-indices, the S&P Arbitrage Index showed a 0.25% gain in June, a 0.81% giveback over the quarter and a 1.52% return on a year to date basis. The S&P Directional/Tactical Index suffered a 0.30% loss for June, but turned in a 4.58% advance for the quarter and a 6.85% boost for the year.

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Meanwhile, the S&P Managed Futures Index had a 5.3% decline in June, a 1.61% gain over the quarter and a 7,34% showing year to date. The Managed Futures index is designed to be an investable benchmark focusing on trading methodologies that constitute a significant portion of the managed futures investment strategies. The Index has 14 constituents, four of which are also constituents of the S&P Hedge Fund Index, which was launched in November (See   S&P Introduces Hedge Fund Index ).

The S&P Hedge Fund Index was up 1.84% in May (See   S&P Hedge Fund Index Ticks Up in May).

Administration July 2, 2003

Pension Woes Pop Up Across the Pond

February 7, 2003 (PLANSPONSOR.com) -Standard & Poor's Ratings Service (S&P) has cautioned that it might downgrade a dozen European companies due to pension underfunding concerns.
Reported by

Following a review of pension underfunding for more than 500 European firms, S&P said it placed the long-term and some short-term credit ratings on 10 leading European companies on CreditWatch, according to a report by Dow Jones.

S&P based its analysis on estimates of the value of equity assets in each company’s pension fund at the end of 2002, and on each company’s total unfunded pension obligations.   Much like the tempest of America’s pension funding crunch, sliding stock prices and the slumping global economic markets have intensified the problems at many firms.

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The companies affected are:

  • Michelin SCA
  • Rolls-Royce PLC
  • Deutsche Post A
  • GKN Holdings PLC
  • ThyssenKrupp AG
  • Linde AG
  • Portugal Telecom SA
  • Pilkington PLC
  • Arcelor SA
  • TPG NV

In addition, S&P said its ratings on J Sainsbury PLC and BAE Systems PLC, which already were on CreditWatch negative, also are now subject to pension-liability review.

After being placed on CreditWatch, S&P said negative listing can either be affirmed or downgraded. The current listing of the European companies is expected to be resolved within about two months.

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