Corporate Bond Sales Surge in 2012

The sales of corporate bonds have surged in 2012, approaching the record amount issued in 2009.

Near-Record Bond Issues 

Data compiled by Bloomberg reveals that earlier in October, global conglomerate General Electric Co. sold $7 billion worth of these financial instruments derived from corporate debt. Business application provider Oracle Corp. issued $5 billion worth of these corporate bonds.

These major issuances brought October’s total bond sales to $347 billion, which represented a new record for this month, according to the news source. The monthly sales figures left the 2012 corporate bond sales total within $116 billion of the record $3.4 trillion issued during the first 10 months of 2009.

Emerging Market Bonds 

Data provided by Benzinga reveals that the market for emerging market (EM) corporate debt has been growing this year, as the sovereign debt of these economies is experiencing strong demand and dwindling supply.

Investment firm Pacific Investment Management Company, LLC (PIMCO) recently wrote that “the supply of U.S. dollar-denominated EM sovereign debt is decreasing and yields are near historical lows,” according to the news source. As a result of this, the investment firm is encouraging market participants to explore the corporate debt offered by companies in these regions.

In a recent PIMCO note, Ignacio Sosa and Anton Dombrovsky stated that “the dollar-denominated EM corporate market has been growing steadily, and many corporates can offer higher yields and lower durations than sovereigns.”

Surging Bond Markets 

Exchange traded fund provider WisdomTree recently said that the market for corporate bonds in these developing economies has increased roughly 100 percent in size since 2008, the media outlet reports. In a note written earlier in the year, WisdomTree wrote that “since 2003, EM U.S. dollar-denominated corporate bond issuance has outpaced sovereign issuance in a trend we believe will make EM corporate debt an increasingly larger allocation to emerging market fixed income.”

Bonds and Monetary Easing 

In the week of the financial crisis, governments have injected record amounts of money into the economy and keeping interest rates at very low levels, according to Bloomberg. Many market participants have also sought bonds amid strong risk aversion. These factors have helped push the yields on sovereign debt to 0 percent or even lower, which has motivated investors to put their funds into corporate debt.

“There’s a lot of money out there looking for a home,” Elisabeth Afseth, an analyst at London-based Investec Bank Plc., who suggests investors refrain from putting money into debt issued by euro zone nations including Spain, Italy and Portugal, told the news source. “Government bonds give you almost nothing, so you’re left with corporate bonds, which give you a little bit more than nothing.” 

U.S. government bonds are the least-favorite asset of money managers

U.S. treasuries are not the favorite assets of money managers, according to The Associated Press.

There are various reasons not to like the financial instruments. They provide very little return and many market experts anticipate that they will lose value when interest rates start to recover from historically low levels. There are various reasons not to invest in the securities, but demand for the financial instruments remains strong.

Many investors expect that prices will fall for these financial instruments, the media outlet reports. This prediction has not materialized yet, and investors who wagered that the prices for the debt instruments would fall did not generate the returns they were looking for.

It is entirely possible that there is currently a “debt bubble” surrounding the U.S. treasuries. While demand for the U.S. debt is strong and the federal government continues to run deficits, this desire for the debt of the world’s largest economy might not be sustainable.

If investors suddenly lose their appetite for U.S. treasuries and the country still wants to operate at a deficit, default could be triggered. More importantly for investors, the returns of the securities could increase.

Facebook Could Bypass Banks in IPO Bid

While investors are eagerly looking forward to any word about the upcoming initial public offering by Facebook, banks may have a little less to be happy about. The Wall Street Journal reports that Facebook could skip the process of collecting underwriters for its IPO entirely.

Underwriters are the banks responsible for judging the interest in an IPO, helping to corral investors and set the initial offering price. Groupon, the latest major online company to go public, ultimately made use of 14 banks as underwriters, while Google had 10 during its IPO in 2004.

However, finance chief David Ebersman has suggested that underwriters might not be necessary for an IPO of such scale as Facebook, and the company has already begun some of the ground work of speaking with investors to rally interest.

Though banks such as Goldman Sachs and Morgan Stanley could still see a role in the sale, the Journal suggests that the company could follow a model similar to Google’s, which slashed its IPO fees by nearly 30 percent using an electronic auction based on the model created by WR Hambrecht + Co.

The Chicago Tribune notes that the underwriters for Groupon have garnered criticism for the performance of the company’s stock since its IPO.

Volatility will continue in 2012

Even if the various troubled nations resolve their major dilemmas this year, investors should be ready for volatility to continue in 2012, Reuters reports.Even if the various troubled nations resolve their major dilemmas this year, investors should be ready for volatility to continue in 2012, Reuters reports.

Even if the United States solves its fiscal deficit, China successfully copes with its economic slowdown, and Europe survives its debt problems, analysts have arrived at a consensus that volatility will continue to be a problem next year, according to the media outlet. Long-term planning and portfolio diversification will be even more crucial as a result of these continuing market fluctuations.

Fran Kinniry, who is a principal in Vanguard’s Investment Strategy Group, told the media outlet that investors “need to develop an asset allocation plan and really try not to get the short-term market to run their emotions” if they are going to invest in the right way.

He added that exchange-traded funds are an attractive option because there is a selection to choose from and they have low costs.

One problem with diversification in such a down economy is that asset classes correlate more strongly than they do during times of expansion. The Motley Fool reports that analysts are not pointing to many asset classes as clear safe havens from market swings.

Zuckerberg Would Prefer Boston to Silicon Valley as Startup

Silicon Valley has a strong and long-lived reputation as the center of the digital world, with many of the world’s largest tech companies started or based there. But Facebook founder and chief executive officer Mark Zuckerberg explained in a recent interview that he would not have moved his company out west knowing what he knows now, according to The Guardian.

Zuckerberg moved to Silicon Valley in 2004, as Facebook was taking shape as a company. He notes that this period bore little resemblance to the party-filled portrayal in The Social Network, but that the area imposed different kinds of pressures.

“It’s still a little short-term focused in a way that bothers me,” Forbes notes from Zuckerberg’s interview. “There’s people who want to start a company not knowing what they want to do, or just to flip it.”

He argues that the pressure for a fast turnaround from investors forces many companies to avoid the long-term planning that ultimately proves essential.

Instead, Zuckerberg suggests he would prefer to have remained in Boston, another focal point of venture capital with a pool of talented young programmers just as strong as that found in Silicon Valley.

How to Approach an IPO

Investing in a newly public company can prove difficult for many inexperienced investors, according to The Associated Press. But some basic tips can help prepare people for what to expect.

The biggest difficulty for most initial public offerings is that for companies just going public there is no open record of their finances to this point. Even with long-established companies, it can be difficult to know much about revenue, costs and profits without explicit financial releases.

The track record for IPOs of late has proven generally poor as well, with more than half of all newly public companies this year trading below their initial offering prices. Of course, anyone investing in an IPO must understand that the chances of losses are relatively strong for most companies, in part because prices rise so quickly with the early surge of demand but also because of the volatility in the wake of this frenzy.

In general, people pay substantially more in the first few days after an IPO than in the weeks following, on average about 11 percent higher when they first hit the open market. Those purchasing directly from the company will also face their own costs, as that is generally impossible without a brokerage account with one of the banks conducting the IPO, the so-called underwriter. These banks impose a variety of rules in order to participate in an IPO, generally designed to target specific clientele, and individual investors must investigate these requirements carefully in the lead up to the desired IPO.

“It’s a rigged game,” David Menlow, president of IPOfn Financial Network, told the AP. “Underwriters rule the roost, and they make the rules for who they’re going to do business with.”

Of course, this highlights another of the major keys: understanding the IPO market itself. This industry utilizes a large number of specialized terms that can be lost on newcomers. Learning to read the actual meanings of terms like underwriter, aftermarket – the share available on the exchange after the IPO – and a “greenshoe option” – an allowance for selling extra shares given high demand – can prove the difference between a profit and a loss.

Of course understanding the market from the company’s perspective is also important. The AP notes that investors should look to companies with high sales and declining costs, a longer pedigree or hopefully profits. Yet CNN notes that companies have many ways of presenting their financials more positively before an IPO than they would appear normally. This can prove difficult for a company, which will quickly come under unreasonable expectations, but the temptation for a dramatic IPO can often prove overwhelming.

Groupon Sees Gains on First Day Public

After conducting a successful initial public offering on Thursday night, daily deals website Groupon saw a positive first day of trading on Friday, according to The Associated Press.

The company took in roughly $700 million in its IPO by pricing itself at $20 per share, with a market capitalization of around $12.7 billion, but by the time the stock hit the open market on Friday morning it was already valued at $27.82 per share, an increase of nearly 40 percent.

Over the course of its first day of trading, Groupon reached as high as $31.14 per share, up nearly 56 percent, but eventually closed at $26.11 per share, a roughly 30 percent increase over the IPO price.

The rise was notable in part because of the lingering concerns surrounding the company, but also because the market as a whole saw a decline on continued concerns about the Greek debt crisis.

The Wall Street Journal notes that the Groupon IPO was seen as a particularly important measuring stick for the IPO market, given the recent reticence of many investors. However, the news source also notes that the remaining slate of IPOs for the year are unlikely to attract the same amount of attention, with few big names planned before 2012 begins.

Starting a company? Good luck – Venture funding drops in Q3

Startups have had a bit more to be hopeful about with the U.S. economy seeming to be on the upswing. But investors are not proving as cheerful through the first three quarters of 2012, as venture capital dropped once again in the third quarter, according to The Associated Press.

The latest numbers from MoneyTree, the quarterly study put out by consulting group PricewaterhouseCoopers and the National Venture Capital Association, show that venture capital funding fell to only $6.49 billion in the third quarter.

That amounts to a nearly 12 percent drop from the second quarter, when funding reached $7.34 billion, and it came on a significantly smaller number of deals as well. Total deals dropped from 992 in the second quarter to only 890 in the past three months.

While the third quarter still ranks above the first quarter of the year, when venture funds distributed only $6.17 billion, the past nine months saw venture funding fall roughly 10 percent from the same period last year.

“The decline in funding for Seed/Early stage companies is firmly in place – we’ve seen a drop in dollars and deals both quarter-over-quarter and year-over-year,” said Tracy Lefteroff, global managing partner of the venture capital practice at PwC US.

The most successful industries for keeping investments going have been in IT and biotech, but even biotech has suddenly had difficulty drumming up interest in new businesses as opposed to older, existing investments.

“We’re seeing fewer new venture funds being raised which means less capital is available for new investments,” explained Lefteroff. “And, we’re seeing venture capitalists be very cautious with the capital that is available due to the lack of a significant number of liquidity events. Instead, venture capitalists are continuing to support the companies already in their portfolio.”

Forbes notes that there have even been some big deals in the past quarter, including $200 million for electronic payments company Square and $125 million for cloud services firm Box. But the investment market beyond electronic industries has looked fairly bleak.

One of the biggest losers was also one of the most prominent fields today – clean technology. Many investors have started to shy away from the area with growing uncertainty about these industries in advance of next month’s presidential election.

Why ETFs are gaining in popularity

Exchange trade funds (ETFs) have been growing in popularity for various reasons, and young investors should definitely be aware of the benefits provided by these financial instruments

ETFs are financial instruments that invest into a bundle of assets and trade like stocks. One major benefit that they provide investors is exposure to assets and risk management strategies that previously required much larger initial outlays.

For example, an investor can purchase a share of a gold ETF for less than $200, compared to the thousands of dollars required to create a commodities account. Alternatively, a market participant can gain easier diversification by purchasing ETFs that invest in the S&P 500 Index and therefore offer exposure to a basket of blue-chip stocks.

Market experts have repeatedly promoted diversification as a means of reducing portfolio volatility. The strategy becomes less effective in down markets, as widespread fear and pessimism help to drive selloffs in financial assets that pushes them down together.

Investors can use inverse ETFs to short plunging indices during down markets to obtain returns when many other market participants are being forced to accept losses. 

Europe Comes to Agreement, Though Issues Remain

Europe took a major step toward resolving some of its debt woes late Thursday and into early Friday. According to The New York Times, the European Union has agreed to change its treaty to require a greater degree of fiscal responsibility from member nations.

The new treaty requires countries in the European Union to limit their deficits to no more than 0.5 percent of their gross domestic product, though that rule can be bent under certain circumstances. It will also impose penalties for those who break that rule and require a greater degree of information sharing.

The treaty did not garner full support of all member nations, with the U.K. and Hungary refusing to support the treaty, though all members of the euro zone voted in favor and it also received a welcome boost from Mario Draghi, the head of the European Central Bank.

‘It is a very good outcome for euro area members and it’s going to be the basis for a good fiscal compact and more disciplined economic policy in euro area countries,” Draghi said, according to The Times.

That same morning, however, The New York Times notes that Moody’s Investors Service also downgraded the credit ratings of three of the largest banks in France – Société Générale, BNP Paribas and Crédit Agricole – illustrating the still growing impact of the debt crisis.

Disappointed Investors Turn Hopefully to Zynga

Investors and companies once again find themselves hoping that Zynga can provide a spark for the IPO market.

Initial public offerings are always an uncertain investment to an extent, with companies often going public without a long-proven track record of success, sometimes looking for the funds necessary to keep the company going. The 2011 IPO market has not proven any easier, with many companies canceling or delaying their IPOs over the summer as the global economy suffered a downturn with both the U.S. and Europe struggling through debt crises.

Ultimately many analysts and even companies have found themselves looking from one high-profile IPO to the next, hoping that it would perform well and provide some encouraging signs for investors. Most recently, daily deals site Groupon completed a $700 million IPO, but it quickly followed the same pattern of most other companies this year and slumped below its early trading prices.

But Forbes reports that online gaming company Zynga, the creator of popular mobile and Facebook games like FarmVille and Words with Friends, stands a strong chance of surviving where many others have not. Valuing itself at $7 billion, Zynga has set far more modest goals than some recent IPOs and actually manages to back it up with a well-established business model that has already managed to make substantial profit – $30 million on $829 million of revenue over the past nine months.

Indeed, Bloomberg reports that Zynga announced on Thursday, December 8, that the company already has enough orders to cover the sizable portion of shares it intends to sell – 14 percent of common stocks, well more than many recent IPOs – at a price range of $8.50 to $10 per share.

Bloomberg notes that Zynga has given itself a substantially larger price-to-sales ratio than some of its primary competitors, but this still compares favorably with other IPOs seen so far this year.

Meanwhile, The Chicago Tribune reports that Zynga founder and chief executive officer Mark Pincus claimed at a luncheon in Boston that his company could reasonably double the number of players who actually pay for the company’s games. At present, paying customers account for only 3 percent of the 6.7 million players of Zynga games.

Investors are likely to remain wary after a bed that saw collapses from essentially every major IPO, but Zynga nonetheless offers as much promise of a spark as any of those earlier entrants held.

Global ETP inflows hit new record during first three quarters of 2012

Money flowed into exchange-traded products (ETPs) at a record rate during the first third quarters of 2012, according to data provided by independent research and consultancy firm ETFGI.

Net inflows
The net inflows into ETPs, which include exchange-traded funds (ETFs), exchange-traded commodities and exchange-traded notes, reached an all-time high of $188 during the nine-month period, according to ETF Daily News. The sum surpassed the previous record of $170 billion going into these vehicles during the first three quarters of 2011 by $18 billion.

Total assets
The total assets that these ETPs had under management rose to a new all-time high of $1.86 trillion during the period, compared to the record of $1.76 trillion that was set at the end of August 2012, the media outlet reports.

Data provided by the independent research and consultancy firm reveals that the total assets held by these ETPs worldwide have increased from $1.53 trillion since the beginning of 2012, which represents a 21.7 percent gain, according to the news source. These numbers come from 4,690 ETPs and 9,626 listings, which are offered by 204 providers and traded on 56 different exchanges.

Of the $1.86 trillion that is held in ETPs, U.S. investors account for 70.1 percent of this total, with Europe representing 18.8 percent and Asia Pacific taking up 3.9 percent. Once these areas have been accounted for, 7.2 percent remains.

Competition among providers
The market for ETPs remains staunchly competitive in the face of robust expansion, and the top three providers of these financial instruments repeatedly draw more than 60 percent of the market’s assets, net new assets and trading volumes, the media outlet reports.

“ETF competition is about getting the product mix and the ETF Eco System right and not just low costs.  We will see some movement in the relative size of the industry heavyweights and while benchmark, performance, trading, liquidity and product structure will continue to be key considerations, costs as we see from the US will be an increasingly important component,” stated Deborah Fuhr, managing partner at ETFGI.

The rising amount of funds flowing into ETPs comes after a 2006 survey predicted that over the next decade, the preferences of investors would change and they would mostly choose to put their assets into financial instruments providing passive investing strategies, according to The Financial Times.  

How to effectively plan for retirement

While the recent bear markets that equities have experienced during and after the financial crisis have certainly not helped to lift the values of the portfolios held in retirement accounts, a recent Bloomberg opinion piece argues that the way humans are inherently wired is a bigger problem.

Immediate Gratification

Rick Kahler, who is a certified financial planner based in Rapid City, South Dakota, told the news source that people are essentially programmed for “financial defeat.” He said that people have a tendency to choose whatever option is the most emotionally appealing at the time.

He uses an example of putting $5,000 into a trip to the Bahamas or putting that money into an individual retirement account so that it can be withdrawn for a retirement that is 10, 20 or 30 years down the line, according to the media outlet.

William Meyer, founder and managing principal of investment research firm Social Security Solutions, emphasized the costs that can be generated by the desire for immediate gratification, the news source reports.

The market expert noted that more-than two-thirds of people who claim Social Security benefits decide to claim these benefits at an age as low as 62, according to the media outlet. Married couples might end up losing up to $100,000 as a result of taking these benefits early.

He added that “if you wait to claim until age 70, you’re locking in a benefit that is 76 percent larger.”

More effective retirement planning 

There are various ways that investors can overcome their natural wiring and therefore do a better job of planning for retirement. One potential problem that people can overcome is a tendency to buy securities when they are highly-visible and also experiencing high prices, and also sell these financial instruments when they have lost substantial value.

This problem can be overcome by utilizing the strategy of dollar cost averaging, which involves investing the same amount on a regular basis. This is the opposite of making efforts to time the market.


Many people also have a tendency to make an effort to pick out stocks that outperform the market. In a market with high correlations, attempting to do so frequently results in failure. Instead, people can diversify their investment portfolios in order to control volatility. Diversification is a strategy that involves picking securities that have the lowest correlation possible.

This opinion piece was released shortly after a recent U.S. Securities and Exchange Commission survey revealed that a substantial fraction of retail or everyday investors know very little about basic financial instruments such as stocks or bonds. 

REITs present many benefits

Real Estate Investment Trusts (REITs) present many benefits for investors. REITs provide opportunities for strong dividends, portfolio diversification, protection from inflation and robust performance.

Commercial real estate sector

Data provided by the 2012 Research Magazine Guide to REIT Investing indicated that while economic growth in the United States slowed during the first six months of the year, one sector that managed to show encouraging signs was commercial real estate.


Many subsectors of commercial real estate fared well during the first six months of 2012, including apartments, warehouse, retail and office space. While vacancy improved gradually, the rents paid by these properties grew.

While the S&P 500 Index surged 9.49 percent during the first half of the year, the FTSE NAREIT All Equity REITs Index, which represents 128 firms in the industry worth more than $500 billion, spiked 14.91 percent.


During a time of high asset correlations, securities that provide diversification can certainly prove valuable. Between the years of 1991 and 2011, REITs had a 56 percent correlation with large-cap stocks. This compares to an 80 percent correlation between small-cap equities and large-caps during the period. During periods of substantial volatility, REITs can be helpful as they do not move closely with other equities.


Equity REITs provide a strong stream of dividend income, due to their corporate structure and their continued collection of rents. These trusts generate the income by gathering rental income from tenants, and the fact that they are incorporated as pass-through entities means that they need to distribute at least 90 percent of taxable income to shareholders every year.

This requirement means that a larger share of their returns is attributed to dividends. The dividend payments made by REITs have generally been substantially higher than those paid by companies contained in the S&P 500 Index.

Protecting against inflation

Investors can utilize REITs to protect themselves from the costs of inflation. These trusts enjoy rents and property values that generally rise along with the price level, which helps the dividends paid by the trusts to increase over time. These gains help to provide investors with income even during periods of high inflation. 

Janus fund provides strong returns with careful bond picks

Gibson Smith and Marc Pinto, who serve as co-managers of the $8.9 billion Janus Balanced Fund, used their research on fixed-income securities to provide investors with the best combination of strong returns and low volatility of asset-allocation mutual funds.

Data provided by Bloomberg Riskless Return Ranking indicates that the fund provided investors with a risk-adjusted return of 2.3 percent over the last five years, which represented the strongest results of 18 different funds that have more than $5 billion in assets and have a bare minimum of 50 percent of their capital in equities.

Bloomberg reports that a separate fund named Janus Balanced yielded a total return of 30 percent during the period, which was also the strongest performance for this metric of any fund in the group, which includes pools of capital managed by Fidelity Investments, T. Rowe Price Group Inc. and BlackRock Inc.

One major play that helped to improve the returns of these managers was a decision to offload financial stocks before the financial crisis started in 2008, according to the news source. They made this move as they grew increasingly worried that lending institutions and other market participants were taking on too much leverage.

The equity and fixed-income research conducted by the fund managers resulted in the firm purchasing shares of beer maker Anheuser-Busch InBev NV, which has surged by more than 100 percent in value since 2009, and the stock of CBS Corp., which has risen by more than 300 percent during this period.

“Because of the collaboration between fixed income and equity, we got some early warning signs on the stress in the financial system in the U.S.,” Pinto, 51, who manages the stock portion of the fund, told the news source in a telephone interview. He said that the fixed-income research conducted by him and his team provided managers with “confidence buying stock when markets were nervous.”

‘Stellar’ performer
The news source reports that the strategies used by the two co-managers has helped them to generate returns above those of competitors over the most recent five years, such as the $13.5 billion T. Rowe Price Capital Appreciation Fund, which generated a risk-adjusted return of 1.3 percent during the period.

“It’s been a stellar performer,” Jeff Tjornehoj, senior research analyst at Lipper, said in reference to the Janus fund. “It looks particularly good next to other moderate risk portfolios.”

The returns provided by the Janus Balanced Fund contrast with those created by the S&P 500, which is currently 7 percent below its record high set in October 2007.

U.S. Stocks Surge Past Other Assets for First Time In Almost 20 Years

U.S. Equities are outperforming other asset classes in 2012 for the first time in close to 20 years.

S&P surges

Data provided by Bloomberg reveals that the benchmark S&P 500 Index has surged 14 percent in 2012, which means that the group of stocks has outperformed commodities, Treasuries, corporate bonds and equities in Asia and Europe.

The S&P has not displayed performance this robust since 1995, when it was enjoying its largest gain in the last 50 years. The benchmark index went on to surge another 93 percent in the following two-and-one-half years.

Investor wariness

Regardless of the risk aversion that many investors are experiencing, some of the best assets are still U.S. companies, according to the news source. Market participants are afflicted with concerns about widespread joblessness and lackluster growth, but these firms have been experiencing strong appreciation.

Market optimists have been encouraged by a recent Federal Reserve announcement that the central bank will both engage in further quantitative easing and also wait until some point in 2015 before raising key interest rates, the media outlet reports.

“We see good earnings growth and improving economic outlook, we see good equity valuations and easy monetary policy, we see skeptical investors and low positioning in equity assets,” Max King, a multi-asset strategist at Investec Asset Management in London, which manages $100 billion, told the news source. “This is a major green light for equities and the fact that people don’t see it, is great.”

Strong future performance 

Equities will continue to enjoy a bull market for another year as market participants become less wary of risk and put their money back into stocks after withdrawing funds from these assets since 2007, Laszlo Birinyi, the president of Westport, Connecticut-based Birinyi Associates Inc., told the media outlet.

The statement of this market expert is supported by Investment Company Institute revealing that global market participants have withdrawn $100 billion from U.S. stock funds in 2012 while putting $250 billion into bond funds, according to the news source.

Birinyi, who was involved in equity trading at Salomon Brothers Inc. in the 1980s, told the media outlet in an October 17 phone interview that the aversion that investors have for the stock market is declining.

Bloomberg data indicates that the S&P 500 finished the week ending October 19 with a price-to-earnings ratio of 14.5, which is still relatively low compared to its 50-year average of 16.2.

Green Investing Rose in Third Quarter

Investment in green businesses and technologies is on the rise again, even as the broader market grows more cautious, according to a new report from Ernst & Young.

The Los Angeles Times reports that green sector investment amounted to only $684 million in the third quarter of 2010. This year saw a major increase, however, rising 73 percent to more than $1.1 billion.

“Confidence in cleantech investing continues despite the challenging investment market,” Jay Spencer, Ernst & Young Americas cleantech director, said in a statement. “We saw significant commitments in energy storage, which reflects a growing corporate focus on proactively managing their energy mix.”

As the biggest success of the quarter, energy storage saw a nearly 2,000 percent increase in funding to more than $420 million, as a growing number of companies attempt to tackle the issue of intermittency in renewable power sources. Energy storage could also serve to spur the growth of the electric vehicle sector.

The Financial Times reports that a recent survey found that a growing number of investors are interested in green or so-called “ethical” investments, with 38 percent expressing interest and the vast majority saying they are willing to switch portfolios if offered such an option.

Hedge funds attracting significant capital from institutional investors in 2011

Hedge funds have been attracting significant capital from institutional investors in 2011, with current funding levels on track to make this the second-best year since 2004.

Institutional investors have been allocating massive amounts of money to hedge funds, with $39.9 billion in net inflows and pending searches happening from the beginning of the year through November 10, according to Pensions and Investments.

The media outlet reports that if the current rate of investment is maintained for the rest of the year – as many market experts predict – 2011 will be the biggest year for inflows into hedge funds since 2007, and the second largest since 2004.

Data provided by the media outlet indicates that a total of $17.4 billion in institutional investor capital was allocated to hedge funds in the first quarter, $5 billion in the second quarter, $8.3 billion during the third quarter and $9.2 billion in the fourth quarter through November 10.

The Wall Street Journal reports its opinion that investors may be looking to hedge funds as they have recorded a loss of 5.4 percent during the first three quarters as opposed to the Standard & Poor’s loss of almost 10 percent.