CFO.com writes "Buyer's Remorse"
CFO.com writes "Buyer's Remorse", which says, "Although auction-rate securities have received scant media attention since [freezing in February 2008] then, they have not returned to health. In fact, the market for them remains decidedly frozen.... Experts say that CFOs and treasurers should have seen signs of trouble. Indeed, even if ARS investors had done nothing more than simply follow sound cash-management practices, the damage would have been far less." The piece says, "For example, nearly half of organizations polled by the Association for Financial Professionals (AFP) in 2008 had policies limiting their investments in ARS to 25% of the portfolio, yet one in four allowed ARS investments to reach 50% or more." It quotes one source, "You can't do anything about greed, but some clients had 100% of their excess cash invested in ARS. That violates a cardinal rule of investment: diversify asset classes." CFO adds, "`Investors were also not adequately compensated for the risk that auctions could fail, notes Adam Dean, president of SVB Asset Management. Average premiums over money-market funds ranged from just 15 to 20 basis points." See also SmartMoney's "The Best Places to Store Your Cash" <i:http://www.smartmoney.com/Investing/Short-Term-Investing/The-Best-Places-to-Store-Your-Cash/>`_.
