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NEWP ....TOP STOCK PICK
by: missed777 04/03/01 08:44 am EDT
Msg: 23393 of 23395
Digital Future Fund tries to right the ship
By Shawn Langlois, CBS.MarketWatch.com
Last Update: 1:00 AM ET Apr 3, 2001
SAN FRANCISCO (CBS.MW) - The notion of investing in a technology-sector fund in this market could cause the average stock jockey to break out in hives. Not Michael Cohen.
His Alpha Analytics Digital Future Fund's uber-rollercoaster ride began in December, 1999. when the newly launched fund rode the bull market's closing weeks to a 100 percent first-quarter return -- enough to earn top tech-sector fund ranking from Morningstar.
Relative to the faltering market, good times held throughout the year as the fund closed 2000 with a cumulative 13 percent loss, compared to the Nasdaq's horrid 39 percent trouncing. Yet when things go sour in tech land, the fund's 1.5 beta exposes it to extreme fluctuations. For instance, it's fallen 52 percent since Jan. 1.
The severe hit comes in the form of an imbedded tax-loss, somewhat unique in the world of technology funds:
"Buying into this fund now would allow the investor to double or triple their money before they have to pay taxes," Cohen said in an interview. "We wouldn't have to throw off taxable distribution until we are higher than our cost basis." He hopes to ride a rebounding Nasdaq well above that "cost-basis" to the kind of gains his fund rejoiced in the immediate wake of its inception.
His top choice, Newport Corp. (NEWP: news, msgs, alerts) , was a test and measure company for the fiber-optic industry that transformed itself into a provider of equipment to automate the manufacturing of optics. "I'm amazed to see how a company could evolve to such an extent in only a year's time," Cohen said. "Despite the rough run of the fiber optic companies, they'll certainly be investing to help automate the manufacturing of their processes."
I will POST this article a couple times today NEWP is a stellar company! Downside is very limited from here, <EOM> |
