Standing Room Only in the Century Club

There goes the neighborhood. It seems that any mutual fund can gain entry to the Century Club these days if it's a small-, mid- or large-cap growth or technology fund.

Twenty-three more funds have broken the triple-digit barrier since our Dec. 22 story on the 86 domestic equity mutual funds that had returned 100% or more in 1999. (IPS New Frontier fund was inadvertently omitted from the earlier story, so the total should have been 87.)

With two-and-a-half trading sessions to go (Friday, the markets are open a half-day), 109 funds have strong-armed their way past the century mark, according to Morningstar. That doesn't even include the more than 30 international and global funds that have also bested the mark.

On a percentage basis, this year's slew of hundred-percenters is equivalent to Mark McGwire -- and 29 of his major league friends -- hitting more than 70 home runs in one season.

In the annals of mutual fund history, this year's Century Club class will surely cause all of its predecessors to spill their drinks. Since the birth of mutual funds in 1924, only 21 had ever crossed the three-digit threshold in a single calendar year before 1999, according to Wiesenberger Thomson Financial.

For an updated look at the Century Club, including a look at the newcomers to the club, click here.

When we introduced the club last week, membership requirements seemed to entail having a small- or mid-cap bias and a strong lineage of technology stocks, which make up an average of 61% of club members' portfolios.

The 23 new entrants to the club since last week exhibit similar characteristics, but their portfolios don't seem to be so, shall we say, exclusive. They're sorted almost evenly between large-cap (29%), mid-cap (36%) and small-cap (30%) stocks, according to Morningstar. And their tech weightings are down to a relatively puny 49% of assets -- which could explain their somewhat tardy entry into the club's ranks.

But they do share other traits in common with their more senior club pals. For instance, their favorite stock? JDS Uniphase(JDSU Quote). That's the most widely held stock by the original members of the Century Club, as well, and tops the Century Club Index.

Qualcomm(QCOM Quote) is the second-most-loved stock of these new additions.

Since we first reported on these funds just over a week ago, club membership has swelled by more than 25%. And with the Nasdaq's historic close Wednesday above the 4000 mark for the first time -- as well as records set by the Dow Jones Industrial Average, TheStreet.com Internet Sector, the S&P 500 and the Russell 2000 -- the club's membership ledger promises only to get thicker by year-end.

-- Joe Bousquin

Battle for No. 1 Fund

The Vanguard (VFINX Quote)500 Index is close to wresting the largest mutual fund crown from Fidelity (FMAGX Quote)Magellan. But we won't know for sure until the firms disclose their year-end asset levels in January.

That doesn't mean people aren't trying to declare the winner in advance.

Two independent newsletter editors, Dan Wiener of Independent Advisor for Vanguard Investors and Jim Lowell of Fidelity Investor, are keeping score on their Web sites. Wiener and Lowell are using the funds' performance and average monthly cash inflows as guides.

Magellan, which has been closed to new investors for more than two years, had $99.2 billion as of Nov. 30, a $900 million edge over the Vanguard index fund. Magellan's year-to-date return (23.2%) is beating Vanguard 500's (20.2%), and the two editors say that performance could keep it out front for another month. As of Tuesday's close, they estimate the asset gap at more than $1 billion.

But neither observer claims that their estimates are exact. Magellan is still taking money from retirement plan investors, but Lowell says those inflows have been sporadic. Still, that could make his calculations less accurate than Wiener's estimates for Vanguard Index 500.

"Your guess is as good as mine. It's a toss-up," says Wiener.

Both Wiener and Lowell agree that investors should focus on which behemoth is better, not bigger.

-- Ian McDonald

Internet Smorgasbord

How many ways can a fund company slice the Internet? At least five, according to Kinetics Asset Management, adviser of the (WWWFX Quote)Internet fund.

Regulatory filings indicate the firm will launch four new Net funds on Monday, raising the number of funds it offers from two to six (including its non-Internet Medical fund, launched in October.)

Each new fund is designed to target a different Net subsector: Internet Infrastructure (software, hardware, communications companies), Internet Emerging Growth (small- and mid-cap Net companies), Internet Global Growth (foreign and U.S. Net companies) and Internet New Paradigm (foreign and U.S. companies that will benefit from the Net).

Kinetics appears to be striking while the marketing iron is hot. In 1999, investors poured $4.6 billion into Net funds and $556 million into the Internet fund through Oct. 31, according to Boston fund-researcher Financial Research.

Kinetics "seems very focused on hot trends, and I don't mean that in a good way. That, to me, is a red flag," says Chris Traulsen, the analyst who covers the Internet fund for Chicago fund-tracker Morningstar.

"That's a superficial view," counters Steve Samson, Kinetics chief executive. "We're trying to provide choice. Some investors are in the Internet fund for different reasons. Some are there as generalists. Some are looking for infrastructure companies. Some are looking for investments in small companies to capture their run-up. Also, there are a lot of strong-performing foreign Internet stocks. These funds will help investors focus on different arenas."

But after reading the Dec. 23 filing, Traulsen says some of the new funds seem redundant and others, despite their names, might not be Net funds at all. For instance, he says, Infrastructure looks like a standard communications fund; Emerging Growth might be redundant since nearly all Net companies could be called "emerging," and New Paradigm might just be "marketing hype" since any company, from America Online (AOL Quote) to an old school industrial titan, could claim some efficiencies through the Internet.

Kinetics' chief strategist Peter Doyle will continue managing the Internet fund with Steve Tuen. Doyle will also run New Paradigm, and Tuen will also take on the Emerging Growth fund. The other funds will be managed by Fred Froewiss (Infrastructure) and Tina Larsson (Global Growth), both analysts with the firm. Only Doyle and Tuen have management track records, according to Samson.

But that record might be a concern right now. Since former manager Ryan Jacob left to start his own fund at the end of June, the Internet fund's performance has sagged compared with other Net funds and the average tech fund.

Although the fund's 213% year-to-date return ranks among the top 20 funds overall, since July 1 the fund's 46.9% return trails its sector peers and the average technology fund, according to Lipper.

-- Ian McDonald

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This story was originally published at 8:09 p.m. ET Dec. 29.