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Strategies & Market Trends : VOLTAIRE'S PORCH-MODERATED -- Ignore unavailable to you. Want to Upgrade?

To: Voltaire who wrote (32345)	3/3/2001 7:17:07 PM
From: stockman_scott	Read Replies (1) \| Respond to of 65232

Stock Funds Gave Little Shelter in Feb. Saturday March 3, 1:33 pm Eastern Time By Patricia Vowinkel NEW YORK (Reuters) - Investors in stock mutual funds had virtually no place to hide in February, unless they bet that the Nasdaq market would fall off a cliff. Just about every category of stock mutual fund racked up losses in February as the Nasdaq suffered its third-worst month ever -- down 22.4 percent -- on worries about the U.S. economy and an endless stream of negative corporate news. ``With domestic stocks, it's pretty across-the-board punishment,'' said Russ Kinnel, director of mutual fund analysis at Morningstar. ``So it was a tough month.'' The big, popular growth funds like the Janus Fund took a beating as technology stocks tanked in February, but even the more conservative value managers, such as Investment Co. of America, turned in a miserable performance. Science and technology stocks, which enjoyed a brief rebound in January, were the hardest hit, down 27.92 percent in February, according to preliminary data from fund tracker Lipper Inc. Funds that bet on the big growth stocks fell 15.09 percent in February and are now down 12.83 percent for the year. Only gold funds, natural resources funds and those that bet on a Nasdaq drop managed to escape the carnage, but natural resource funds were still down for the year. Gold funds rose 4.50 percent in February while natural resources funds were up 0.73 percent. U.S. diversified stock funds fell 9.05 percent in February and are now down 6.64 percent for the year, according to the Lipper data. Although February was bad, stock funds were down even more in November, with a decline of 10.06 percent, and in August 1998 with a loss of 16.67 percent. ``A single down month isn't that unusual,'' Kinnel said. ''It's more that it comes after a harsh six months already. The pain threshold is rising,'' he said. But the industry's biggest names, the ones owned by average investors, took a pounding. The $100 billion Vanguard 500 Index Fund fell 9.14 percent in February and is down 5.92 percent for the year while the $96 billion Fidelity Magellan Fund lost 9.37 percent in February and is now down 6.42 percent this year. Investment Co. of America, which has $57 billion under management, fell 4.7 percent in February. The $42 billion Janus Fund was especially hard hit. The fund, which built its success on investing in technology stocks, fell 17.36 percent in February and is now down 10.63 percent for the year. Out of the 25 largest stock mutual funds, the only one to eke out a gain was the Income Fund of America, up 0.06 percent in February and 1.94 percent for the year. Mid-cap and small-cap growth funds also fell sharply, down 14.64 percent and 12.99 percent respectively. Value funds fared a bit better, but not enough to protect investors from losses. The large-cap value funds fell 5.37 percent, while mid-cap value funds fell 3.16 percent and small-cap funds fell 1.84 percent. The top performing funds were those that placed bets that the Nasdaq market would fall. The leader was the Profunds Ultra-Short OTC fund, up 74.87 percent. It was followed by the Rydex Arktos fund, described as a domestic hybrid fund, up 33.06 percent. The fund has 44.5 percent of its assets in cash, 25.6 percent in stocks, 10.9 percent in bonds and 19.1 percent in other assets, according to Morningstar.com The Potomac OTC Short fund ranked third in February, up 32.56 percent. The biggest loser was also a Profunds fund; the Profunds Ultra OTC fund, down 47.96 percent. It was followed by the Berkshire Focus fund, a large growth fund, down 46.10 percent. Berkshire's biggest holdings included EMC Corp (NYSE:EMC - news), Juniper Networks (NasdaqNM:JNPR - news) and Applied Micro Circuits Corp (NasdaqNM:AMCC - news). The Delaware Technology and Innovation fund came in third, down 41.65 percent. Its biggest holdings were Applied Micro Circuits and Juniper Networks.