The Internet is beginning to produce distinctive new mutual funds, ones you could not have imagined seeing a few years ago--or even a few days ago. Several of them lend new meaning to the word unique.
StockJungle.com Free S&P 500 Index could be dubbed the Amazon.com fund for its copycat business plan: Come up with an exotic name for a Web site, then offer a product at a ridiculously low price. As the name implies, this fund really is free of charges and sales fees. Its sponsors, like Amazon, will lose money on every sale. "It's a loss leader," says Jeff Lloyd, director of communications for StockJungle.com. "You don't make it up on volume." Of course, many non-Internet funds have waived expenses for a limited time to attract investor interest.
Though it encourages investors to make all their transactions on the Web site, the fund is no different from any other S&P index fund. A potential pitfall: Tracking the S&P 500 isn't as easy as it seems, and success requires more than a low expense ratio--or even no expense ratio at all. You're probably best off waiting to see how well this fund performs before investing.
StockJungle.com Community Intelligence attempts to bring the "shout it out loud" democracy of the Internet to fund investing. Visitors to the fund's Web site will be asked to submit stock tips, and the fund plans to select its portfolio based on those ideas. This fund and two others offered by StockJungle have 1% annual expense ratios. Unplugged investors can request information about any of them by calling 877-732-7696.
X.com at www.x.com has teamed up with Barclays Global Fund Advisors to offer low-cost funds online. The first three are X.com S&P 500, X.com U.S. Bond (which will track the Lehman Brothers Aggregate Bond index) and X.com Money Market. More funds will be launched early next year. The X.com funds will compete with low-cost funds managed in-house by online brokers E*Trade and Charles Schwab.
For disclosure, nothing outdiscloses Open Fund. You can check on the fund's latest stock trades at www.metamarkets.com, as well as comments on why they were made. "I'm betting we are near a bottom," co-manager Maurice Werdegar wrote after buying shares of the Gap.
Moreover, a camera records everything the fund managers do and sends snapshots to the Web site. If you click on the image, you can move the camera and make your own snapshots. Now, this truly is something new under the sun.
BRIEFS
Dow Chemical's proposed takeover of Union Carbide, which is in the Dow Jones industrial average, makes room for the possible inclusion of Intel or Microsoft in the index.... Ryan Jacob, formerly manager of Internet fund has, launched Jacob Internet (888-522-6239).... American Century has ended its policy of waiving fund minimums for investors willing to invest at least $50 monthly in any of 24 funds.... John Horseman is leaving GAM International. His replacement, Jean-Philippe Cremers, worked for Horseman for seven years.... Neuberger Berman (800-877-9700) has started Regency, which will invest in stocks of cheap, midsize companies, and has reopened GEnesis, which invests in stocks of small companies.
WWW
MORE BROKERAGES join the list of those providing free stock research on the Internet E*Offering (www.eoffering.com), the investment bank of E*Trade, and Wit Capital (www.witcapital.com), an online investment-banking firm, are two of the latest. You can also receive a weekly report by e-mail on Internet stocks from the BancBoston Robertson Stephens brokerage; visit www.internetstocks.com. tocks or fund
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