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NM ScholarsEdge |
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State Provider: New Mexico; Net Assets ($mil):
$1,353.3 as of
10-31-09 |
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New Mexico's Scholar'sEdge advisor-sold plan, managed by Oppenheimer, had a good deal of exposure to some of the bond world's worst offenders in 2008. In particular, the plan had assets in Oppenheimer Core Bond, a fund that sustained steep losses in 2008 due to management's big bets on illiquid securities. The plan also had exposure to Oppenheimer Limited-Term Government (run by the same management team), which didn't fall as hard in absolute terms but significantly lagged peers in 2008. As a result, the plan's age-based "Ages 15 - 17 Years Portfolio" (which also plays double duty as the fund's static "Ultra-Conservative Portfolio") lost nearly one quarter of its assets in 2008. Problems began to surface at Oppenheimer's domestic fixed-income products in November 2008, but it took almost four months for the state to make changes. As of mid-February 2009, Oppenheimer Core Bond is no longer an option for new investors and has been replaced with a respectable actively managed diversified bond fund from American Century. We think this was a wise move, but issues still remain. First, the plan still has exposure to Oppenheimer Limited-Term Government, a fund we have little faith in. We're also concerned that existing shareholder money is still tied up in the worst offender: Oppenheimer Core Bond. We hope the state moves those college savings assets into the better fixed-income products now offered, but shareholders should consider moving their money to another plan instead of waiting in limbo. On the positive side, the plan does offer generous state income tax deductions for residents, and it also offers good flexibility among age-based, static, and individual fund options. But until more changes are made on the fixed-income side of the plan, we'd steer clear. (Information as of 04/06/2009) |
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| Availability: Sales Channel |
Resident: Both
Non-Resident: Both
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| Annual State Tax Deduction |
| Max Investment/Beneficiary |
| Mos. to Qualified Withdrawal |
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Public, Private & International
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Age-Based Portfolios
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| Static Portfolios and Self-Directed Funds |
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| US Stock
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Bond |
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| Total International Funds: 19 |
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| Underlying Funds’ Ratings |
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| Overall Morningstar Rating |
# Equity
Funds |
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# Bond
Funds |
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| Ratings as of
10-31-09 |
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| Range |
0.2 |
| 529 Plan Avg |
0.8 |
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| Portfolio Expense Ratio Range |
| Fee to Change Beneficiary |
| Share Classes: Sales Charge |
| A:
4.75% (front-load) |
| B:
5% (deferred-load) |
| C:
1% (deferred-load) |
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| Initial Purchase |
$250 |
$250 |
| Additional Purchase |
25 |
25 |
| Initial (AIP) |
25 |
25 |
| Additional (AIP) |
25 |
25 |
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