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To: THE WATSONYOUTH who wrote (16326)	9/26/2000 11:16:09 PM
From: Captain Jack	Respond to of 21876

From Technology Investor magazine--- Window Dressing. It's Real. Aaron's First Report on Mutual Funds In the West It's 4:00 AM my time and I just found out that Janus Funds cancelled our meeting today. I have not met a single mutual fund yet, and I've already learned something. Window dressing is real. Janus Funds very politely cancelled our meeting today. Their explanation: fund managers must tend to their funds before they can do public relations. I heartily agree, though why they agreed to the meeting four weeks ago and then cancelled at the very last minute is beyond my tiny brain. But why are Janus Funds managers so busy that they cannot spare an hour to explain what they do best and get themselves some free ink in the world's best investment magazine? Simple: This is the last week of the quarter, the last chance to dress up their portfolio with the stocks that will impress investors and the media. No respectable mutual fund manager will admit to this, but the pressures for window dressing are absolutely real. Holding bad stocks when the quarterly list is released taints public perception of a fund. That's why I expect an increase in volume and volatility through the rest of the week: fund managers (not just those at Janus Funds) will be selling the stocks that disappointed during the quarter and buying the stocks that went up. Go back to our home page and read about stocks we think will be "window dressed." Wednesday June 28 9:00am: Invesco Invesco Funds Fund: Invesco Telecommunications (ISWCX) Manager: Brian Hayward Portfolio: $6 billion Team: Donna Jaegers, assistant portfolio manager and Brian Miller, equity analyst. Description: Invesco has 33 different funds. Managers meet regularly to share ideas. Hayward works closely with Bill Keithler, manager of the $10 billion Invesco Technology II (FTCHX) and his team. Hayward, or one of his team, has met the CEO of every company his fund owns at least once, usually more. Best quote: "Our high-yield bond fund [run by senior VP Jerry Paul] acts like a canary in a coal mine. They seem to find the rumors and problems about companies before the equity guys do. They tell us how a company's bonds are trading. That gives us a good fix on the company. It's also a window into a company before its IPO." Second best quote: "Our turnover [buying and selling stocks] is very low. It was 55% last year and running about 44% so far this year. That makes for very low capital gains distributions [lower tax bite]. Our distribution last year was 0.3%. The next closest competitor in our group was at 4%." 11:00am: Marsico Funds Marsico Capital Management Funds: Marsico 21st Century Fund (MXXIX) Manager: James Hillary Portfolio: $144 million Team: Six research analysts; 2 research associates Description: Jim Hillary and Tom Marisco have dominated this company, since it started in 1997. They are responsible for its success. They research a huge range of companies across a broad swath of technology. Best quote: "The market reflects news at light speed. You hit price targets soon if you are right and you are in the doghouse for a long time if you are wrong." Second best quote: "The market is very emotional right now, led by fear, greed and momentum. It's hard to make sound investments when logic doesn't rule. We try to get different information before the rest of the market, so we can be logical." 3:30pm: ICON (Meridian Investment Management) Marsico Capital Management Funds: 12 ICON Sector funds, including Telecommunications and Utilities (ICTUX) and Technology (ICTEX) Managers: Craig Callahan and Nick Azari Portfolio: $500 million Team: Three research analysts Description: Callahan and Azari pick their stocks using a quantitative model, an extensively enhanced version of Graham’s model for value investing. They build their portfolio by identifying the best industries within each sector and then buying a bundle of the stocks in that industry. They focus at the industry level to reduce the impact on their portfolio of random events at one company (missed earnings, executive departures, lawsuits). Best quote: “We don’t know the story [behind a company]. The story is the most fun part of investing. Magazines like the story. But we don’t know it. We prefer numbers to stories. So we make for a pretty bad interview.” [Not even close to the truth -- editor.] Second best quote: “We believe there is a law of nature in the market. We have observed investors as if they were in a lab. We believe our equation captures the way they behave, on average. Every now and then they get carried away in one direction or another. We think we’ve learned to tell when their changing direction.”