Morgan Keegan /RMK Funds

Diya Gullapalli of the WSJ has reported that Investors in Tennessee filed a federal lawsuit seeking class-action status against Morgan Keegan Asset Management Inc. over two mutual funds that are among the hardest-hit in this year’s credit chaos. Fund managers and others on Wall Street will be closely watching this case and others that are expected to be filed, as investors take losses from the credit crunch. At issue are the Regions Morgan Keegan Select Intermediate Bond Fund and the Select High Income Fund, which are down 47% and 56%, respectively, so far this year. The suit alleges, in part, that the funds misrepresented or failed to disclose material facts relating to the risks and ease of trading for certain securities in the portfolios. Read more. […]

Andrew Tanzer of Kiplinger.com reports that for years, bond funds run by Morgan Keegan’s Jim Kelsoe soared. Then, like Icarus, Kelsoe strayed too close to the sun and came crashing back to earth with melting wings. Kelsoe’s losses so far in 2007 have been stunning. Regions Morgan Keegan Select High Income (symbol MKHIX) plummeted 56% through December 5, and Regions Morgan Keegan Select Intermediate Bond (MKIBX) collapsed 45%. Results of four closed-end Morgan Keegan fixed-income funds also managed by Kelsoe have also been disastrous. To read the full article click here. […]