IndexFunds.com Staff

News Roundup

The Vanguard Group today launched the Single 5 fixed annuity, which will be underwritten by Jefferson Pilot LifeAmerica Insurance Company. The new annuity offers a guaranteed fixed rate of return over the first five years and annual fixed interest rates after that.

Fixed annuities enable investors to defer taxes on interest earnings, and may be attractive to those who have maxed out their as 401(k) plans and Individual Retirement Accounts (IRAs). Although fixed annuities are a conservative option for tax-conscious investors, by nature they may not provide as much inflation protection as other income-oriented investments in times of rising interest rates.

"For investors seeking a conservative, tax-deferred investment, fixed annuities can be a useful retirement vehicle and a valuable estate-planning tool," said John Brennan, Vanguard's chairman and CEO, in a statement.

The initial guaranteed interest rate for the Vanguard Single 5 is 5.00%, and the minimum initial purchase is $10,000. The new fixed annuity will be managed by Vanguard's fixed income group. Since 1991, Vanguard has also offered a variable annuity program, the Vanguard Variable Annuity Plan, which has about $5.6 billion in assets.

iShares asset growth in January

As expected, the iShares MSCI EAFE has quickly become the largest AMEX-listed exchange-traded fund tied to an international benchmark. Launched in August 2001, the EAFE fund is rapidly closing in on $1 billion in assets under management.

Source: Barclays Global Investors, data as of 1/31/2002

On the domestic front, also not surprisingly the iShares S&P 500 is the largest ETF offered by San Francisco-based Barclays Global Investors. The iShares S&P 500 is currently the fourth largest domestic ETF, while State Street's SPDR 500, also based on the S&P 500, is the largest with a market capitalization of over $27 billion, according to the American Stock Exchange.

Source: Barclays Global Investors, data as of 1/31/2002

The largest sector iShare is the healthcare fund - with $227.3 million in assets under management as of the end of January it is the 16th largest domestic iShare.