Excerpt from Smart Money Article: What To Do Now With Tech Funds?
Dow Jones Newswires -- June 5, 1998
"Everything in the portfolio was down a fair amount," fund manager Rizza
says.
The fund has redeemed itself this year, though, returning 22.9% so far,
compared with a return of 8.6% for the average equity fund, and a loss of
2.5% for the average technology fund. The return was driven by large
positions in America Online (AOL) and Yahoo! (YHOO), up 76% and
55%, respectively, this year. Rizza says he"s trimmed back his Yahoo!
stake recently to just over 3% of assets.
"We've had to take profits, or it would've become the entire portfolio," he
says. Rizza says the fund has been in and out of just about every
technology subsector, but he has had particular success in wireless
equipment stocks such as Nokia (NOK/A), and networking companies,
like Cisco Systems (CSCO) and Ascend Communications (ASND). Two
months ago, he started buying Fore Systems (FORE), a producer of
asynchronous transfer mode, or ATM, technology.
As Sprint (FON), Worldcom (WCOM) and the regional bell operating
companies move from circuit-based networks to packet-switched
systems, to handle more voice and data traffic, Rizza sees the ATM
industry growing at a 30% to 50% rate.
After a troubled period last year, when Fore's stock sunk to the low teens
due to inventory gluts and product delays, the company is now snapping
out of its doldrums, he says.
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