Two new tech funds rolled out today, one from a company known for investing in tech, another known for investing in golf.
The first is broker-sold
Munder International NetNet
. Munder also runs
NetNet, the industry's largest Net fund, that will close to new investors on April 17.
previewed its international counterpart in this on Jan. 25.
The second is the no-load
fund, which comes from
, a young fund shop in El Cajon, Calif. The firm also manages
, which focuses on the golf industry. TSC
previewed Wireless and
Investec Guinness Flight's Wireless World
on Feb. 29.
Even a value comeback in the offing couldn't save Bill Sams.
The value stalwart was replaced last week as manager of the Los Angeles-based
FPA Paramount fund, which was well into its third year of negative returns. In his place are Eric Ende and Steven Geist, co-managers of the
FPA Perennial fund.
A press release from the company says Sams decided to retire, though it reads like a mea culpa: ``For the past three years the performance of FPA Paramount has not been satisfactory, and I take full responsibility for it,'' it quotes him as saying. FPA did not return calls Monday afternoon.
Sams, who spent almost 19 years as the fund's skipper, had amassed a decent long-term record in the mid-'90s by picking beaten-up ugly ducklings. It wasn't unusual for him to build outsized positions in just a few stocks in his concentrated fund At one point last fall, Sams had just 11 stocks in the fund and an almost 20% cash stake.
But severe losses in 1998 were followed by a small, 1.6% gain last year. And this year, the fund is down 13.8%, far below the downtrodden brethren that share its mid-cap-blend category.
``The good times and the decent times outweighed the bad performance, but not anymore,'' says
analyst William Rocco who follows the fund.
Particularly detrimental were Sams' bets on oil drillers and gold stocks. This year, for example, all the stocks in the fund's top five are in the red.
The Perennial fund, is up 7.5% year-to-date under Ende and Geist, more in line with other value funds. It is in the top quartile of the small-cap blend category for the last 12-month period.
Rocco says shareholders should expect the Paramount to resemble Perennial in coming months with more holdings. Ende and Geist "are not 20-holdings kind of guys,'' Rocco says.
Turner Readies Five New Funds
Turner Investment Partners
figures it can strike when the iron is hot.
Riding a wave of alliances and lofty performance numbers, the Berwyn, Pa.-based fund family plans to roll out three funds that will leverage the company's technology expertise and two that will expand it into a surging market for international funds.
The five funds are
Global Top 40
Wireless & Communications
, according to papers filed with the
Securities and Exchange Commission
The firm will roll out the Global Top 40, B-to-B and Wireless funds first, says Robert Turner, chief investment officer. They're likely to hit the market by July 1. The launch date of the international funds is uncertain, he says.
The Global Top 40 fund will invest in the same names as Turner's domestic, tech-heavy
fund and add 20 international stocks. The B-to-B fund will focus on the trendy business-to-business Internet subsector and the wireless fund targets another hot technology subsector.
"Technology has always been the largest segment of what we've done and we're very comfortable with that," says Turner.
If the company's current offerings are any indication, these new entrants should do well, particularly if they follow a similar style and have some of the same holdings. Three of Turner's six equity funds rank in the top 15% in their categories for the 12-month period ending Mar. 31. Another is in the top 34%, and the last two were launched late in the year and don't yet have a 12-month record.
In the past month, Turner struck deals to rebrand two of its funds and allow them to be sold as offerings of
Merrill Lynch's Mercury
unit. Officials of Turner said at the time that the deals would allow them to spend more time managing money instead of marketing funds in a very competitive category.
But with three new offspring arriving in the family soon, marketing duties may be just heating up.
Pioneer Rolls Out Tech Fund
Since the average tech fund posted a 135% return last year, there's been an avalanche of new tech funds.
is the latest fund shop to belatedly discover the sector.
Launched Friday, the broker-sold
Pioneer Science & Technology
fund will be managed by Kenneth Fuller and tech specialists Thomas Crowley and Robert Junkin. The managers will focus on large-cap "market gorillas" with part of the portfolio and small, emerging companies and initial public offerings with the other part.
Interestingly, Fuller's background is as a small-cap-value investor. He took the reins of Pioneer's
Micro Cap and
Small Company funds last October and has had decent success. Since Jan. 1, both funds beat more than 90% of their small-cap-value peers, according to
. Neither fund has an outsize tech bet, so it will be interesting to see how Fuller and his colleagues do.
The fund isn't cheap, according to its prospectus. Class A shares levy a maximum 5.75% front-end load and sales charge, while class B and C shares' maximum back-end loads are 4% and 1%, respectively.
Class A shares' annual expenses are 1.75%, while class B and C shares' annual expenses are 2.5%. The average tech fund's expense ratio is 1.77% according to Morningstar.
Vanguard Index Fees Go Lower Still
Some of the cheapest index funds around just got a bit cheaper.
, synonymous with low-cost index investing, announced it had dropped transaction fees on purchases of five index funds and reduced them on three others Monday.
Total International index funds now have no transaction fee. The funds previously charged between 0.25% and 0.5% on share purchases.
Three other funds have reduced their transaction fees, which previously ranged from 0.75% to 1% annually. They are:
Emerging Markets (now 0.5%),
Tax-Managed International (0.25%) and
Tax-Managed Small-Cap (0.5%). (Emerging Markets also charges a transaction fee on redemptions, as well as purchases.)
Historically, the fees offset the trading costs of putting new cash to work, and they are paid into the fund rather than to Vanguard. Reduced trading costs and a policy of using redemptions to offset the transaction costs of selling new shares has allowed Vanguard to reduce the fees, the company says.
Investors' hunger for index shares has waned recently. Of course, a jittery market (and even lower costs) could boost interest.