Funds With Delta, Northwest Exposure

ING Smallcap Value, Fidelity Destiny II and Fidelity Discovery could be hit.
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Will your mutual fund be grounded by the bankruptcies at

Delta

(DAL) - Get Report

and

Northwest

(NWAC)

airlines?

Probably not. The writing has been on the wall for those two carriers for so long that most portfolio managers bailed out a while ago. Even so, a few funds were long shares of Delta or Northwest fairly recently, even as it was abundantly clear the companies were jetting toward Chapter 11 bankruptcy protection.

As of June 30, the ING

(IVSAX) - Get Report

Smallcap Value fund had 1.8% of its assets in Delta, making it the most concentrated owner of any fund in the Morningstar database. No other fund had more than 1% of its assets in Delta or Northwest at the end of the second quarter.

The

(FDETX) - Get Report

Fidelity Destiny II fund was the largest holder of Delta's outstanding shares with 6.4% at the end of June, though the airline only made up 0.71% of the fund's assets, says Morningstar.

Fidelity Destiny II was also the mutual fund with the largest stake in Northwest shares with 7.9%, or 0.89% of the fund's assets at the end of the second quarter. The only fund with a higher percentage of fund assets in bankrupt Northwest was the

(FDSVX) - Get Report

Fidelity Discovery fund with 0.93%, says Morningstar.

Despite being the fund with the largest stake in Delta, the $5.2 billion Fidelity Destiny II, probably won't feel the pinch too much considering its size. Furthermore, the fund is closed to new investors. Not that Morningstar itself recommends you bang down the door to get in.

"Since taking the helm in June 2000, Adam Hetnarski has had a bumpy ride here. He buys a mix of rapid growers and steadier, moderately priced fare, and typically trades at a furious pace, combining longer-term holdings with attempts to capture short-term moves in stocks and industries," says Morningstar analyst Greg Carlson. "That type of approach is tough to pull off, and Hetnarski has struggled at times; the fund's record is subpar on his watch."

Hetnarski's large blend fund is down 1.09% this year, trailing the

S&P 500

by 3.6 percentage points.