Now that Ryan Jacob has

departed, the

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Internet Fund is lowering its fees in a bid to keep the assets flowing in.

The fund filed a supplement to its prospectus Thursday capping its expense ratio at 2%. That's more than a third less than the 3.08% expense ratio the fund charged in 1998.

"We've been moving the expense ratio down as assets have been rising," says Steven R. Samson, president of

Kinetics Asset Management

, the fund's adviser. The Internet Fund saw a dramatic increase in assets between the end of 1998, when it had about $22 million, and this April, by which time it had amassed $700 million.

"It's a lot of the fixed costs

of running a mutual fund that were keeping it at a higher level last year," says Samson, who joined Kinetics from

Chase Manhattan's

asset-management unit last month as Jacob was resigning as manager of the Internet Fund. "But now, that's being spread over a much larger body of assets."

The capping of the fund's fee brings it more in line with the three other Internet funds that have somewhat established records in the space (this is the Internet we're talking about here).

The only other no-load fund in this group is


WWW Internet, which capped its expenses at 2.5% in its latest prospectus, with a 1% redemption fee for shares sold within a year of purchase.


Monument Internet, which charges a 4.75% one-time sales load, has an expense ratio of 1.9%.

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Munder NetNet's A shares carry a 5.5% sales load but a lower 1.56% expense ratio. (There are other classes with lower loads but higher expense ratios.)

The average expense ratio for a technology fund, according to


, is 1.75%.

Sales loads usually are one-time charges paid when an investor buys a fund, though they can be assessed later on (back-end loads) or over several years (level loads). Expense ratios are applied annually. That means, in general, its cheaper to own a no-load fund over the short term and a load fund over longer periods of, say, 15 years or more.

But while the Internet fund is lowering its expense ratio, Samson expects the fund to make more money this year as a business than it did in 1998. Incredibly, the top-performing fund of last year only paid Kinetics about $26,000 as its management fee. This was due to the fund's small asset base for most of the year, as well as the outlays it had to make to improve infrastructure as demand for its shares skyrocketed.

"We'll be introducing our

national ad campaign in mid-August, and I think that will greatly enhance awareness of the fund," says Samson. "I think we're optimistic that assets will continue to rise."

We're Not No. 1

So long slogan, so long dollars. That's the lesson the

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Kaufmann fund is learning lately. For years, the fund touted itself as the No. 1 small-company fund in ads featuring the suspenders-clad duo of Lawrence Auriana and Hans Utsch. But lately, it has had to

revert to more generic slogans ("Experience counts!").

That's because, as of the first quarter of 1999, the fund doesn't qualify any longer as the No. 1 small-company fund over the last 10 years in



Dollars are following the fund's old slogan out the door. In the first five months of 1999, the fund had net redemptions of more than $1 billion, or more than 25% of its assets, according to

Financial Research


No word yet on whether the fund has had to sell its stock to meet those redemptions. Utsch, who had a

testy exchange with

Herb Greenberg's

trusty assistant,

Mark Martinez

, earlier this week, didn't return a call for comment. But first-half numbers for redemptions will be out soon.

With a three-year annualized return of just 7.8%, (it's down 0.5% year to date), the bleeding could keep going. Those numbers put the fund in the bottom quartile of its peers, according to Morningstar.

Invesco Plays the Name Game

After a spring cleaning of mergers and liquidations that

rubbed out 11 funds earlier this year,


is making more adjustments to its funds lineup via two name changes.


Industrial Income

fund will become the

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Equity Income fund and the

Worldwide Communications

fund will become, simply, the


Telecommunications fund.

The Telecommunications fund is returning 57.1% year to date, while the Equity Income fund has posted a 12% return. That compares with the 12.9% return of the

S&P 500


Invesco spokeswoman Molly Cisneros says the name changes will simplify things for shareholders.

"The fund name itself is what's going to draw somebody to even consider your fund," Cisneros says. "And so we're offering clearer names on our funds so that people don't have to dig to find out what the fund actually does."

Not to mention that "industrial" today isn't quite the buzzword it was back in the 1960s, when that fund was launched. Or that the omission of "worldwide" from the telecommunications fund might keep some investors from worrying that some of their funds are invested overseas.

"I think telecommunications is inherently global," says Cisneros. "I don't think that just because we changed the name takes away the fact that it's got global exposure."

Cisneros says the funds now have identical names to their respective Lipper categories. "Call it marketing ... but if they're looking for an equity income fund, we have one. And if they're looking for a telecommunications fund, we have one," she says. "I think it certainly helps them pinpoint the funds."

Sure, with about as much precision as a chainsaw.