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Page E2 • Wednesday, March 19, 2014

8IN BRIEF

Northwest Herald / NWHerald.com

Understanding complicated hedge-fund styles

Siemens will build locomotives for U.S. rail

Hedge funds are a diverse class of investments that use unique investment strategies to seek greater-thanaverage total return with lower levels of risk. Hedge funds might use many investment tactics not ordinarily available to the managers of regulated mutual funds, including unlimited short-selling, margin trading to leverage price movements, and the unfettered use of derivatives as direct investment vehicles. There are more than 8,000 hedge funds; they come in all shapes and sizes. The multitude of recognized hedge-fund investment styles and variants might appear confusing to the uninitiated. However, you might find it much simpler to think of funds as falling into one of four major groupings: event driven, market neutral, multinational and niche. Event-driven funds follow investment strategies designed to profit from a known or forecasted event, such as distressed securities and merger and value opportunities. Market neutral funds generally attempt to neutralize investors’ exposure to significant changes in

CHICAGO – Siemens will build 32 diesel-electric locomotives for high-speed rail projects in the Midwest and on the West Coast. The company announced Tuesday it had won a $225 million contract and will deliver the first of the cleanerburning, faster locomotives by 2016. Illinois led the procurement for the next-generation equipment for it and four other states: California, Washington, Michigan and Missouri. Illinois has been overhauling its cross-state Amtrak route from Chicago to St. Louis to boost speeds to 110-mph. The Charger locomotives will be built at Siemens’ rail manufacturing plan in Sacramento, Calif. The lighter weight locomotives can operate at speeds up to 125 mph. The multistate deal includes options for 225 additional locomotives. The routes are part of President Barack Obama’s effort to expand high-speed rail.

investment. For example, investing in five hedge funds with $1 million minimums would require $5 million. Investing in a fund of hedge funds that invests in those same underlying funds may require only $1 million. Factors to consider: When considering the differences among these styles you also should keep in mind other common terms relating to hedge-fund investing. Individual risks include bankruptcy, the effects of competition and changes in technology, among other things. Market risks indicate the possibility that an entire broad category of assets will gain or lose value simultaneously. The value of a hedge fund’s assets sometimes can be difficult to ascertain. As some hedge funds invest in highly illiquid securities, they might be hard to value. Hedge funds do have higher fees than many other investments. Managers typically charge 1-2 percent in fees, plus a performance fee of up to 20 percent of its profits. Many hedge funds restrict the opportunities to redeem shares and

INVESTING Timothy Dooley portfolio value caused by market risk. These funds divide their assets among investments with complementary risk characteristics so that any force that drives some portfolio assets in one direction will drive other portfolio assets in the opposite direction. Multinational funds invest in nonU.S. stocks and bonds using strategies such as fundamentals and technical indicators, global macroeconomic or financial market trends, and topdown and bottom-up considerations. Niche funds follow narrowly defined styles, including sectors, shortselling and market timing. They also can invest in listed futures and options to benefit from expected trends in commodity prices, interest rates or currency exchange markets. Fund of hedge funds: Through a fund of hedge funds, investors can gain access to a number of hedge funds with a relatively smaller

often impose a lock-up period of one year or more after your initial investment. Hedge funds often engage in speculative investment practices that might increase the risk of investment loss. Hedge funds also can be highly illiquid, are not required to provide periodic pricing or valuation information to investors, might involve complex tax structures and delays in distributing important tax information and are not subject to the same regulatory requirements as mutual funds. If you are contemplating the use of a hedge fund in your portfolio, consider that hedge funds are complex investments with limited liquidity compared with stocks, bonds or mutual funds. Work with your financial professional to determine whether they might be right for you. Happy planning. • Timothy J. Dooley, CFP, is president of Comprehensive Retirement Resources Inc., an independent firm at 201 N. Draper Road, McHenry. Reach him at 815-578-42170.

Poll: People still seek meaty news on media buffet By CONNIE CASS

IRS: Worker took home personal info on workers

The Associated Press

WASHINGTON – An Internal Revenue Service employee took home personal information on about 20,000 IRS workers, former workers and contractors, putting the data at risk for public release, the agency said Tuesday. The employee took home a computer thumb drive containing names, Social Security numbers and addresses of the workers, and plugged the drive into an unsecure home network, IRS Commissioner John Koskinen said in an email to employees. “At this point, we have no direct evidence to indicate this personal information has been used for identity theft or other inappropriate uses,” the IRS said in a statement. Koskinen said the incident did not involve any taxpayer information.

WASHINGTON – A new study finds Americans of all ages are charting their own paths across a media landscape that no longer relies on front pages and evening newscasts to dictate what’s worth knowing. They still pay heed to serious news even as they seek out the lighter stuff, according to the Media Insight Project. The conclusions burst the myth of the media “bubble” – the notion that no one pays attention to anything beyond a limited sphere of interest, such as celebrities or college hoops or Facebook. “This idea that somehow we’re all going down narrow paths of interest and that many people are just sort of amusing themselves to death and not interested in the news and the world around them? That is not the case,” said Tom Rosenstiel, executive director of the American Press Institute, which teamed with the Associated Press-NORC Center for Public Affairs Research on the project. People today are nibbling from a news buffet spread across 24-hour television, websites, radio, newspapers and magazines, and social networks. Three-fourths of Americans see or hear news daily, including 6 in 10 adults under age 30, the study found. Nearly everyone – about 9 in 10 people – said they enjoy keeping up with the news. And more than 6 in 10 say that wherever they find the news, they prefer it to come directly from a news organization. The study found relatively few differences by age, political leanings or wealth when it comes to the topics people care about. Traffic and weather are nearly universal interests. Majorities express interest in natural disasters, local news, politics, the economy,

– From wire reports

AP file photo

Americans of all ages still pay heed to serious news even as they seek out the lighter stuff, choosing their own way across a media landscape that no longer relies on front pages and evening newscasts to dictate what’s worth knowing, according to a new study from the Media Insight Project. crime and foreign coverage. With so many sources and technologies, 60 percent of Americans say it’s easier to keep up than it was just five years ago. But at the same time, Jane Hall, an associate professor of journalism at American University, said no one is setting the national news agenda the way The New York Times and network evening news once did. “I do lament those times in which something could become so important that we all watched,” Hall said. “But that doesn’t mean we aren’t all engaged now.”

If you’re under 30, the future of news is in your hands, literally. Three out of four young adults who carry cellphones use them to check the news. Most owners of tablet computers also use them to get updates; young people are the ones most likely to have tablets. But the young think of news differently than previous generations did, said Rachel Davis Mersey, an associate professor at Northwestern University’s Medill School of Journalism. Their broader definition includes anything happening right now, whether it’s sports or entertainment or politics. “We don’t see young people thinking of it as a civic obligation to keep up with news,” Mersey said. “We see young people including news as part of a very complex, very diverse, very large media diet that includes a diversity of sources, a diversity of platforms and really goes 24/7.” The Media Insight Project study found 20-somethings likelier to follow up when they hear something big is happening. Americans get that first word in an assortment of ways. Traditional news operations still dominate, but word of mouth, email and text messages, Facebook and Twitter, and electronic news alerts also come into play. Most people say they have more confidence in a story when they get it directly from a news-gathering operation. But their media habit doesn’t include paying for it – only about a fourth have paid subscriptions. Nine out of 10 watched some type of TV news in the previous week. Newspapers, including online editions, and radio news each reached more than half the country.

BRIDGE

Crossword ACROSS 1 Word of exasperation 7 Katmandu tongue 13 Wrinkly-skinned dog

30 Designed to minimize wind resistance 31 Prepare, as some peanuts 32 Campbell of “Party of Five”

33 Traditional 14 One of the red pre-Christmas Monopoly spaces activity 16 Triumphing 36 Cartoon shriek 18 Open-house org.

37 Roll-call call

19 ___ polloi

38 Bub

20 Lunes or martes

41 The First State: Abbr.

21 Ring decision, briefly 23 Matt who scored the only Jets touchdown in Super Bowl history 25 2B, SS or CF 26 ___ Stic (retractable Bic pen) 27 Comic Fields who was an Ed Sullivan regular 28 “Amores” poet

43 Cry at the World Cup 44 Fleet member retired in ’03 47 Place on a pedestal 49 Last book of the Old Testament 51 Element in chips 52 Became too old for foster care, say 53 Testifying accurately

ANSWER TO PREVIOUS PUZZLE I M P A L E S

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O P U R R E P L A O R N E

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A V E N G I E N T U O L U N C A H

G L A Z M O D E C A L L T A I E H I G N E D J A O T O P H I P G E N R N T O I O I D R Y L T E E H E R

E D L A I T A E N H A N A B E I L R E S S U C R T H E R A I S T T E R E S Y

H O A R D E O R S S A I M F O Y U N T S

S W E D

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Y A O

55 Rare sight on casual Friday 56 Hawke of Hollywood 57 Buffalo’s county 58 Marks of good bowlers 59 Surgical bypass 60 AOL alternative DOWN 1 One operating a loom 2 End of Kurosawa’s “Rashomon”? 3 Directional ending 4 Prefix with center 5 Nixon, e.g., for two yrs. 6 1952 Gary Cooper classic 7 Believer that life is meaningless 8 Suffix with acetyl 9 S.F. summer setting 10 It’s about 1% argon 11 Had a break between flights 12 Clear and direct, as reporting 13 Common Nascar letters 15 Letters on a perp’s record 17 Morgue ID 22 Christmas carol starter 23 They vary according to batters’ heights 24 Poison gas, e.g. 25 Florence’s ___ Vecchio

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19 21

36 38

37 41

55 58

PUZZLE BY PETER A. COLLINS

26 Bopper 29 “___-lish!” (“Yum!”) 34 Longtime Florentine ruling family

39 They’re said at the end of a soirée 40 Dog that might be named Shep 42 Derby victory margin, maybe

35 There might be one on the corner of a sail

43 Many an urban Cornhusker

38 Atomizer outputs

44 Searches high and low

45 Quarantine, say 46 Dime-on-thedollar donation 48 Happy tunes 50 To the point, in law 54 Day after hump day: Abbr.

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By PHILLIP ALDER Newspaper Enterprise Association

Marcus Tullius Cicero, a Roman statesman and orator who died in 43 B.C., said, “Orators are most vehement when their cause is weak.” I often feel that way about playwrights who include lots of shouting -- they could not think of anything worthwhile to write. This week we are looking at bidding with weak hands -- for example, the gorgeous two-count held by North. After partner opens one notrump, he must not pass, but must convert the contract to two spades, here via a transfer bid. His hand might be useless in no-trump, but will be worth three or four trump tricks in spades. After West leads the heart king, how should South plan the play? Note that North’s having to use a transfer, rather than a natural, drop-dead two-spade response, has the disadvantage of giving the opponents two chances to enter the auction; but it does allow the strong hand to become the declarer. If East-West do enter the auction and reach three

diamonds, a club lead is fatal. The defenders can take one heart, three diamonds, one club and a club ruff by North. South has six losers: three spades, two hearts and one club. However, he can eliminate one loser by winning with the heart ace and cashing his three diamond tricks, starting with dummy’s queen (the honor from the shorter side irst). On the third diamond, declarer discards a heart from the board. Then, with his loser count down to ive, he leads a trump and keeps playing trumps every time he is back on lead.

Contact Phillip Alder at pdabridge@prodigy.net.