Mutual Funds for Kids

The fund's fee is capped at 1%, which includes 12b-1 marketing fees, management fees and other fees. It is also a no-load fund, meaning investors do not incur a sales charge when they buy the fund.

Bacarella says his efforts at getting his children interested in investing were fruitless -- until he bought them each shares in a company that made crayons.

Shortly after buying the shares, the company sent his children an introductory package including crayons, a coloring book and some other company products. Bacarella says that was enough to entice his children and get them interested.

"I wanted to carry this theme to what we are doing," says Bacarella, who initially applied the idea to the company's flagship fund, the (MONTX Quote)Monetta Fund (MONTX). Bacarella says he started asking some of the companies they invested in to send kid-oriented products, which they would pass on to young investors.

There was a great response from investors, he says, but as the accounts grew (the Monetta Fund now has about $60 million in assets) the companies weren't able to send so many products.

"We knew we needed a program to do it ourselves," he says.

Here's what they came up with: When a child or teenager joins the fund, they are given an investment kit, which for children eight years old and younger includes an activity book, a CD with songs about money and a copy of the kid-friendly newsletter chock-full of jokes and other information that is intended to make it interesting to them.