The old normal allocation between the three most basic classes (Cash, Bonds and Stocks) is currently the new normal.

While the old normal return expectations for U.S. securities, and the allocation between U.S. securities and global securities (particularly emerging market securities) is not likely to be resemble the past; the old normal weighting between cash, bonds and stocks from whatever country is more likely to be used than not.

The last decade was abnormal in the preponderance of equity risk assumed in the aggregate across all households in the United States. The old normal is more balanced, which is something the typical investor advanced in age or wealth accumulation is seeking these days.

Based on Federal Reserve data from 1945, the average allocation between cash, bonds and stocks was approximately 10%, 40% and 50% respectively. The average over the past decade was about

The Dent Tactical ETF, the first offering from AdvisorShares, is now out. And honestly, I just don’t know how to size it up.

Skepticism definitely plays into the mix when considering this new exchange-traded fund (NYSE Arca: DENT).

Ron Rowland has written a recent Seeking Alpha column in which he projects that the ETF will make his April 2010 ETF Deathwatch list. He makes some very interesting and valid points. (You can also see related IU.com stories on DENT's costs and a recent Q&A with Dent about his investment strategies here and here.)

My concern I share with Rowland is with the fund's expense ratio – 1.56 percent before the waiver, and 1.5 percent after.

That’s A LOT of basis points, and it seems to undermine the very foundation of what an ETF is supposed to be all about. According to the Investment Company Institute, the average expense for

This week, Congress is taking up a relatively simple set of changes to how 401(k) plans work. And yet again, the Investment Company Institute picks the wrong side of the fight—the side of active management.

Back in 1999, I stood in front of an ICI meeting arguing for increases in portfolio disclosure requirements. At the time, it was hard to imagine the 10-year boom we've seen in ETF assets, and the increasing willingness of alpha-seeking managers to make daily disclosures of their portfolios. I was called naïve and foolish, and perhaps I was.

Yesterday, the Committee on Education & Labor kicked a bill (full text) for consideration down to Congress that feels awfully similar—it would require a boatload more disclosure of what really goes on inside 401(k) plans, and mandate the inclusion of at least one passively managed option for participants. (The bill's full name is the Fair Disclosure and Pension

Each month the Investment Company Institute publishes data for net money flows into and out of mutual funds available in the United States which we present here.  They have turned positive after months of massive outflows.

While ETFs are quite popular and increasingly so, mutual funds still are where the bulk of retail investor fund assets are found — 401-k plans being a major factor.  That makes data on mutual fund money flows a good indicator of the behavior of the “average Joe” investor.

Here are three charts showing the mutual fund net money flows from 2002 through April 2009.

The first chart shows the total flows for equity mutual funds.  The second chart shows the 3-month moving average of net flows into those funds that invest primarily in the US and into those that invest primarily on a world or international basis.  The third chart shows the cumulative net flows for each

China's A-Shares No. 1 In First Quarter

The best performing index in the first quarter was the Shanghai Composite, according to this Investor's Business Daily report.

It notes that a closed-end fund tapping into mainland China's stock exchange, which is largely closed to outside investors,  the Morgan Stanley China A Share Fund (CAF), has gained 49% so far this year. 

The story notes that China-focused ETFs haven't fared as well since they don't invest directly in A-Shares. But technically, they seem to be holding up well, writes IBD markets reporter Trang Ho. 

(Interestingly enough, Van Eck Global has filed to offer the first A-Shares focused open-end ETF. See story here.)

You can read the IBD report here.

Japan Tries Another Round of Stimulus Packages With ETFs

Japanese Prime Minister Taro Aso is moving forward with plans for another round of government-enduced stimulus packages aimed at jolting the country's falling economy.

The CEO of the Investment Company Institute suggested yesterday that the providers of financial advice should act in the best interests of clients. The scary thing is: People were surprised.

Investment News reported the story:

"In what might come as a surprise to the organization's members," it wrote, "the head of the mutual fund industry's biggest trade group last week said that he supports the idea of requiring all financial advisers to act as fiduciaries." [Emphasis added.]

Specifically, ICI CEO Paul Schott said that the fiduciary standard "provide(s) a higher standard of responsibility and accountability." He added: "Isn't that something that all of our recent experience suggests is important?"

Umm ... well .... Yes.

And yet—and this tells you a lot about the bizarro-land in which the ICI and much of the mutual fund industry has operated for the past 50 years—the ICI doesn't actually support what Schott

Mutual fund money flows, which are a good indicator of overall retail investor market views, have been strongly negative in recent months. Global and international equity funds have experienced greater negative money flows than domestic US mutual funds this year. Until the 2008 market drops, US equity funds received lower money inflows than global and international funds.

Representative US equity funds include:

SPY, IVV, IWB, IWV, TMW, IYY, and VTI

Representative international and global equity funds include:

EFA, VEA, EEM, VWO, VEU and VT.

The data for the following charts is taken from Investment Company Institute publications.

click images to enlarge

Average Monthly Flows

3-Month Moving Average Flows

Aggregate Annual Flows

Richard Shaw QVM Group LLC

Mutual fund money flows, which are a good indicator of overall retail investor market views, have been strongly negative in recent months. Global and international equity funds have experienced greater negative money flows than domestic US mutual funds this year. Until the 2008 market drops, US equity funds received lower money inflows than global and international funds.

Representative US equity funds include:

SPY, IVV, IWB, IWV, TMW, IYY, and VTI

Representative international and global equity funds include:

EFA, VEA, EEM, VWO, VEU and VT.

The data for the following charts is taken from Investment Company Institute publications.

click images to enlarge

Average Monthly Flows

3-Month Moving Average Flows

Aggregate Annual Flows

Richard Shaw QVM Group LLC

The veteran ETF analyst says new job with BGI will give her even more resources to track such an expanding and complex marketplace. 

Barclays Global Investors caught the attention of the market last week with its hiring of Deborah Fuhr, arguably the most well-known among analysts tracking global exchange- traded funds markets.

The former Morgan Stanley strategist announced September 7 that she's moving from one of the world's largest brokerages to Barclays Global Investors, the ETF industry's biggest player. (See related story.)

Fuhr started her new job this week as BGI's global head of ETFs research and implementation strategy. Even though she has been busy  assembling a new staff and preparing for her new position, Fuhr took time out from her busy schedule recently to talk to IndexUniverse.com's Eric Rosenbaum about the move to BGI and its implications.

IndexUniverse.com (IU): Will you be moving to BGI's headquarters in San