Conference nyoss1::market_investing

    I deal now, or have in the past, with Drefus, Fidelity, Janus,
    Lexington, Twentieth Century, and Vanguard.  I would characterize
    Lexington as not being very customer oriented; interesting, their
    performance in all funds is lackluster.  Otherwise, all other funds
    have been responsive within the bounds that you should expect from a
    Fund house as opposed to a brokerage; information on funds, FMV, Your
    Funds' Balance(s), etc., but NOT individual stock recommendations. 
    Each fund's "accessability" on the phone seems relative to the size of
    the corporation.  Fidelity has additional phone asnwerers on call for
    busy times, for instance. All offer "telephone switching trades"
    between their own funds (although some have restrictions to keep
    activity/expenses down), all will sell (redeem) funds over the phone
    and accept wire purchases/sales if you fill out the application
    properly.
    
    About the only reason I can think of to purchase a Mutual Fund through
    a broker would be if the fund is not offered for sale by the Fund's
    management; Mexico Fund, for instance.
    
    Remember, these folks are in a business that is even MORE Customer
    Satisfaction oriented that Digital's business.  If our customers go
    sour on DEC computers, they will seldom pull out all of our equipment,
    but will simply stop buying.  If a MF's customers go sour, they yank
    out assets faster than a speeding bullet (or touch-tome phone).  If you
    want a case study of top-drawer, company wide marketing, spend some
    time researching Fidelity.
    
    Hope this helps,
    Dave

>    About the only reason I can think of to purchase a Mutual Fund through
>    a broker would be if the fund is not offered for sale by the Fund's
>    management; Mexico Fund, for instance.
    
    Well, MXF is a closed-end fund and therefore is traded like any stock.
    You can't buy it any other way.
    
    Here's two other possiblities:
    
    - Using a broker allows you to deposit your funds as collateral for
      margin purposes; you can get 200% invested this way.
    
    - At least one broker will sell you load funds at substantially less
      than the load charge imposed by the fund manager.  They do this by
      maintaining an inventory of funds and reselling them.  Seems almost
      a shady operation but hey, they advertise in Barron's...
    
      John

.1 - That's basically what I was looking for.  Thanks.

.2 - That's a little out of my league.  I feel like I know the game a little
better than the average novice, but I don't have resources much beyond the
average novice.  Maybe someday, hopefully soon ... now where was that "get
rich quick" note ?????  :-)

Thanks


Continuing with this theme, how about comments on fund companies, and your
opinions of their providing of good customer service?  Another one I'd like
to hear about is CGM.  (I know, Capital Development is closed, but Mutual
isn't ...)

Naturally, I'll add my 2 cents on this topic.  As soon as I earn my first
2 cents on Janus Twenty, anyway :-)

    
    
    	Another way to redeem your shares is to have a Money Market account
    with checking along with your stock fund. This way you can keep 
    any extra dollars in the MMF without having to worry about price 
    fluctuation. And if you decide that you want to get out of the stock
    fund simply transfer the money over from the stock fund to the money 
    market and write a check.  The only drawback would be is with some
    funds you may need to keep 1,000.00 to keep the money market account
    active. Spread out over a number of fund companies, this can get to be
    a larger percentage of cash than your investment goals may dictate.
    
    I have this currently set up with Janus, 20th century, and Scudder. The
    good thing about the Janus MMF is that if you automatically put in
    50.00 a month with their automatic investment program, they waive the 
    1,000.00 min. initial deposit. 
    
    John 

	There is another reason to buy MF's thru discount brokers. On those
	busy days, as recently seen, when you can not get thru' to the MF
	phone system, you can call your broker (whose lines are easier to get
	in my opinion) and do your trade. Depending on the size of your 
	investment and the market fluctuations, you can justify paying the
	broker fees for not missing out the day.

	I know, I wished I had bought some of my 20th Century Ultra thru a 
	broker: I could not get thru' to them in 3 consecutive days and the 
	market had changed in the meantime not to justify the sale :-(.

	As an aside, I have accounts with 4 MF's and their rankings, in terms
	of the ease of getting thru' their phone lines is:

	Dreyfus
	Scudder
	Financial Programs
	20th Century.

	Their performance ranking has roughly been the reverse :-).

re: 18.0

I don't understand this.

You use a discount broker if you want to trade individual stocks, options, etc.
and you do your own portfolio management.

You use a mutual fund if you don't wish to do portfolio management and to better
diversify, among other things.

Of course, you could be in mutual funds and individual stocks, options, etc.

As far as responsiveness is concerned.

Discount brokers don't really do anything for you, i.e. you get what you pay 
for.

Most of your contact with a mutual fund company comes in the initial 
investigation of the fund before you invest. To do this, you really only need 
to make a single phone call to get the latest financial reports and prospectus 
(parts A and B).

What can you expect from a mutual fund company?

1. Distribution of financial statements, prospectus (parts A and B) and proxies.
2. Periodic statements of your ownership and dividend reinvestment.
3. Year end tax info, depends on type of fund.
4. Exchange privileges among funds of the same family (a discount broker likely
   could offer "exchange" among funds of different families, however, at a 
   price).

What more should you expect?

As a SERPer, I'm contemplating paying $245 for a copy of the Morningstar 
CDROM which I would use to SORT the 2400 funds (within fund classes) on 
% return as well as on other variables over several time periods (1 to 15 
years) and, thereby, selecting the one(s) that seem to have been best most
of the time in the past.  I would then invest, via IRA, in one or more of 
these mutual funds.

Is this too simplistic a way to cut my investment expenses relative to 
using a broker, an advisor/planner, etc. and having to "carry" that 
person's one or two percent extra expense.  I know that a true expert 
would probably be worth his expense in terms of value added; however, 
I don't believe I can tell the true expert from the one that has good 
"bedside manner" and is just two or three jumps ahead of me in knowing
how to invest.  Would I be making a gross error with this go-it-alone 
approach?

Knowledgeable inputs would be most appreciated.

george

re: .7  -< Cutting expenses >-

Hi George,

I think it is asking too much of statistics to just use past performance
numbers (however allocated) to make decisions on what mutual funds to buy.
In fact, I was in the library yesterday and read the latest Morningstar
summary report which had a good article on this subject by Don Philips, 
the publisher.  He was explaining their 5 star rating system, and pointing
out its limitations.  His main point was that an investor must use many
other considerations - anything from the type of manager to macroeconomics.
In other words, the statistics and numbers are only guidelines, but 
bottoms-up and fundamental considerations should still be used.   

I'm still debating what to do with my lump sum.  I've been leaning toward
a discount broker - say, Waterhouse.  This would mean I could get some
closed-end funds, or even stocks:-).  Also, I'm not totally convinced that 
pure no-load funds are the way to go.  Maybe they are too limiting.   But, 
of course there are those fees, those transaction fees (even if with a 
discount broker) and those load fees if it's a load fund.   Still, shouldn't 
one assume that such fees are the price one pays for having access to a 
wider variety of investment options.

Just food for thought.  I'm still on the fence.

Mardy

    Yes, I just discovered the fact that the CDROM includes Morningstar's 5
    star rating as part of the CDROM distribution.  Notwithstanding the
    caution, how wrong can one go by personally ranking the funds on past
    history and then ANDing that with the 5 star rating?  Sure, there are
    always additional factors that should shape the decision.  But, as I
    asked before, how does one know which advisors are the best if one is
    not more expert in the field than the advisors that are being compared?
    
    george

    and, also, wouldn't the 5 star ranking be based on ALL factors that
    Morningstar was aware of?
    
    george

re: 18.10   <<< Note 18.10 by MRCSSE::COLMAN >>>

Yes, the 5 star ranking is really great!  But....  let me quote a portion
from the lead article in the April 17, 1992, Commentary from Morningstar
which is entitled "Reading the Stars":

"...... First, the ratings are strictly quantitative, based on historical
risk and return analysis.  They do not incorporate subjective criteria,
such as an opinion of the manager, or a forecast of which types of securities 
will produce the best results.  We may discuss such items in the analysis,
but the rating itself remains purely objective."

mardy

re: .7

>As a SERPer, I'm contemplating paying $245 for a copy of the Morningstar 
>CDROM which I would use to SORT the 2400 funds (within fund classes) on 
>% return as well as on other variables over several time periods (1 to 15 
>years) and, thereby, selecting the one(s) that seem to have been best most
>of the time in the past.  I would then invest, via IRA, in one or more of 
>these mutual funds.

      Do  you  remember  all  those  warnings about past performance not
      guaranteeing future results? Well, it is true, True, TRUE! And the
      further  back  you  look, the less correlation there is.  In other
      words, it might be interesting to know that a fund  has  performed
      well  for  15+ years, but its FUTURE performance is more likely to
      track the most recent 1-3 or at most 1-5 years.   I  would  expect
      that  you'd get better results using only 5 years data and even in
      that span weighting the more recent data more heavily.
      
      I  would also suggest that you NOT do this as a one-time exercise.
      Follow  your  fund(s)  closely,  looking  at   their   performance
      carefully at least once a month, maybe each week.  The reason that
      past performance doesn't guarantee future result  is  that  things
      change.   They've  changed  in  the past, which is why more recent
      history is more useful. And things WILL change in the future, too.
      A  fund  that  is a good choice today may be a sell candidate in x
      months.

      You  mention  that  you are sorting "within fund classes".  Do you
      have some criteria for which class(es) you will select from?   And
      for  how you will balance your portfolio among you choices.?  This
      too is a decision you should re-visit periodically.
      
      Don't take my meaning wrong. The average investor -- even a lot of
      above average investors -- won't  do  well  by  weekly  or  monthly
      switching of funds.  However, I believe that a prudent investor in
      mutual funds will benefit by making adjustments from time to time.

>Would I be making a gross error with this go-it-alone approach?

      Maybe.  But then anybody can make a gross error with any approach.
      Any reasonable, systematic approach shifts the odds in your favor.
      The  very  fact  that your asking this question indicates that you
      are less likely than many people to make a "gross error".

    I have about 5k I want to put into a Mutual Fund, after carefull
    condideration and weekly tracking for about 9 to 10 months I've picked
    Janus Twenty. (Not to mention article I've read on the performance on
    Janus twenty, and recomendations from anylysts on future performance
    perspectus).
    
    I'm still up in the air on wether to invest via IRA or not. Reason
    being is, I already have a couple of IRA'S and if I were to have to
    withdraw the money for any reason at all I would hate to have to take
    the 10% penalty fee on top of the taxs involved.
    
    I beleive I remenber reading in Money that if one opened an account
    this year (1992) via Mutual Fund the 10% penalty would be waivered if
    for any reason the money was withdrawn. Dont quote me on this one I just
    dont remember too clearly.
    
    Comments are more than welcome............
    
    Frank
    

      Being a Janus Twenty holder, I like your choice of fund. Money
      still rates it the top growth stock fund for long range results.

      If you are invested into your 401k, as I'm sure everyone is, then
      I'd stay fairly liquid for now and keep it out of the IRA. Being 
      a stock appreciation fund with low turn-over and no dividends,
      you shouldn't see a large taxable impact. If Clinton restores the 
      IRA deduction next year for all persons, then you might rethink 
      your situation.

      Be sure you contact the fund management and find out when distributions
      are given out. If they are close at hand, then plan your buy after 
      that date. (tax reasons) 

There is a IRA bill being pushed by Sen Bentsen which will allow penalty free
withdrawals for college, medical, or first time house expenses.  It hasn't
passed yet.  Keep it liquid, and if the bill passes and you fall in that 
category of needs, then you can switch.

Ditto on the choice of Funds.  I like J20, but I couldn't complain since
I got in on the dip this summer, and it has been jumping the last couple of 
months. If you are looking at splitting into multiple funds in the same family,
rather than all in the 20, get a prospectus for their three new funds.  I am
interested in the new Enterprise fund, which has mid-cap companies.  I think 
I'll wait until the annual report comes out the 30th, so I can get a listing 
of that funds holdings.

Murph

BTW, as far as I know, IRA contributions are still limited to $2000 per
annum, regardless of their tax deductibility.

~K.

    
    Is there a directory of phone numbers for mutual funds in this file 
    somewhere? 
    
    Steve
    

    Not sure about this notes file, but.... most investing magazines
    (Money, Forbes, BW, Kiplingers to name a few) review most mutual funds
    once a year and the same issue carries all the numbers. Also, Money &
    Kiplinger's carry a review of certain categories of funds in every
    issue and also list the numbers for the reviewed funds. The Forbes
    mutual fund listing happens in the last week of Aug/1st week of Sep.
    Money/BW/Kip do it in the earlier part of the year. Of course, if you
    want a particular family, I can always look it in my copy...

    
    How about Janus???

Janus 1-800-525-3713

I currently hold all three CGM funds (yes there is a small third fund).  The
Capital Development fund was started by my wife before we where married (in 
fact before it was it's own company).  It was part of the Loomis-Sayles group
before being purchased by Robert Kemp (the fund president) and Kenneth Heebner 
(the fund manager).  In fact my mother-in-law was Mr. Kemp's personal assistant.
Needless to say I have nothing but great things to say about the company (an 
880% return on original investment may have something to do with that).  The
majority of our investment capital is currently in this fund, and will continue
in this fund for at least the next ten years.  Alas the fund is closed to new
investors, but I'd like to say a couple of things about CGM Mutual and CGM Fixed
Income.

CGM Mutual is a good balanced fund.  Balanced is the key word here.  Don't look
for the spectacular returns that Capital Development has achieved in it's 
history.  Do look for great retruns for a balanced fund, with limited down side
risk.  The fund is 50% invested in bonds and 50% in growth stocks.  The 1993 
return was a little disappointing (due mostly to Ken Heebner hold the bond 
portion in 30 treasuries a little too long).  But it didn't loose money, in
fact it hasn't in the last few years.  If you are looking to accent your
portfolio with a little balance it's a great choice.

CGM Fixed Income fund is another good choice for diversification.  I dollar cost
avereged up to a little over 12% this year.  It doesn't have a track record (it
began last May), but I have high expectations for it.  I also would expect it
to have an impact on CGM Mutual.  The portfolio mix of CGM Mutual looks like 50%
of the money was invested in the same stocks as Capital Development and 50% in
Fixed Income.  Oh almost forgot, that 12% was from May to December.

As far as service, well I'm not sure what you're looking for.  If you call CGM
they will send you the application, prospectus, and any information they may have
on hand.  If you are a share holder and call about your account, you aren't
technically dealing with CGM.  You've called State Street Bank, because that's
who CGM uses to do their record keeping.  It wouldn't make sense for them to do
it themselves...that's where expenses of a fund come in (along with brokerage 
fees, I believe that CGM uses A.G. Edwards a lot).


So here's to my daughter's education and early retirement!

Michael

Just found this out.  It closed on Jan 3, 1993

-D

    re: -1
    
    Unless you requested literature before 93 and received it after 93 or
    if you have money in any of their other funds. Under these two
    conditions, you can still open Janus 20 if your application is
    postmarked by Feb 12, 1993.
    
    michael

     I have the option of getting some money into this before it finally
     closes (owning shares in other funds).  Does its closing make it a
     better investment?  Is this a golden opportunity?
     
     Can someone explain the implications?
     
                                       lance

re -.1

My opinion is that Janus 20 has an excellent record and most advisors like
its future too.  If you have a chance to get into the fund before it closes
DO IT.  If you just put in enough to meet the funds minimum balance then you 
are locked in forever.  Once in you can add to and take away from the fund
at will.  As long as you don't close it out or go below minimum you are in.

So even if you are not interested in investing a lot with j20 now, its worth 
getting in to give you the option.  I've done this with a few funds which I
was interested in and were rumored to be closing to new investors such as
Monetta and Kaufman.

gary

    Janus20 is being run by an excellent manager Tom Marisco. He also runs
    the IDEX I, II & III funds (they are the loaded cousins of J20) and
    also manages for private clients of the Janus Group. All the major
    sources on mutual fund perf rate his funds (the IDEX or the J20) very
    highly.
    
    My $0.2 worth...

    Some Janus Twenty holdings as of 10/31/92:
    	Common Stock - 86%
    	Treasury Notes (1996-2002) - 8.2%
    	Mexican Cetes (11/5/92) - 1%
    	GE Capital Corp Notes - 4.7%
    
    Large Holdings included:
    	BankAmerica
        First Union
       	Amgen
    	Phillip Morris
    	Pfizer
    	FNMA
    	Coca-Cola
    	Intel 
    	Microsoft
    	Wal-Mart
        Telefonos de Mexico SA de CV (ADR)
    
    	Except for Coke, J20 holds on the order of $100-200 Million of each
        with total net assets of $2.4 billion.   

    Morningstar rates Janus 20 a 5 star fund of average risk.  It's also a
    no load fund and the latest info that I've received is that it will be
    closed to new investors as of close of business on Feb. 12.
    
    Peter

    re: -1
    
    The J20 Fund is already colsed to new investors unless you currently
    have an account open with another Janus fund families. If that is the
    case, you have until Feb. 12, 1993 to open an account with J20. But, if
    you currently do not have any account with the Janus Group of Funds,
    then, it's already too late.
    
    Mike

	You requested a prospectus in 1992 and it was delivered to you in 1993.

    I have two of the special applications if anyone wants them - I'm in
    NUO.
    
    michael

    I've received requests for both of them so the offer's over.
    
    michael

I have a J20 app. that came with the annual report.  

John Murphy
dtn 225-4964

    I wasn't fast enough,  the J20 application is gone.
    
    I'd like one if anyone else has one.
    Diane

    The applications are coded but I'm not sure if they are coded to
    prevent application of an account to J20 if the dates aren't right.
    
    -TB

    I got an offer for an application.  Thanks!

    Let's step back a bit and look at the certain trends with Janus 20.
    
    Its 5-yr annualized rate-of-return is 26%.  Damn attractive.
    Its 3-yr. annualized rate-of-return is 20%.  Not bad.
    Its 1-yr. return is <10%.
    
    See a trend here?
    
    In 1989, it had assets of $  68M.
    In 1990, it had assets of $ 244M.
    In 1991, it had assets of $1348M.
    In 1992, it had assets of $3200M.
    
    See a trend here?
    
    Are they linked?  Is it possible the declining performance of J20 is
    because it's hard to turn a 3 billion dollar battleship?
    
    Perhaps that's why the fund announced it was going to close.  Create a
    last-chance-to-get-aboard mentality.  Should pull in another $300M of
    new money, I bet.

    
    	Re: .37
    
    	I think the trend of 5-year annualized returns looking real good
    followed by the 3-year being nice and the 1-year being so-so is typical
    of many mutual funds these days.  Remember, the 5-year period right now
    would start in January of 1988 which was right after the crash of Oct
    87.  Stocks were way down and recovered a lot of territory since then.
    The last three years include the tail end of that recovery plus some
    recession doldrums.  The last year has been so-so all around.  Most
    funds have this kind of 5/3/1-year trend right now.
    
    	Actually, out of curiosity, replay the trend numbers pretending
    that it is still last summer so that the 5-year numbers include the
    crash.  The coupling of the asset and return trends won't be so clear
    then.
    
    							-craig

Janus 20 had a real bad run in the first half of 1992.  That has reversed
largely due to a runup in Intel, Microsoft, and Outback Steakhouse.  Since
I got in at the summers low at 21.49 it is at 25 and change (when you include
the distribution).  I am happy with the current protfolio. And I am equally
happy (maybe even more so) with the performance and holdings of Janus
Growth and Income fund.  It is run by the same manager but is more diverse.
The lack of the 20 comapany format has allowed Marsico not only to hold
Intel and Microsoft, but also some Dell. Plus there are some higher dividend
securities.  The only drawback when I entered was that 20 had a ~1% expense
ratio and G&I had a ~2.5.  G&I is now down to that level due to increasing
assets.  I highly recommend this fund. Since July, from 12.57 to 14.63 (including
6 cents of income distribution). A good alternative to the 20 fund.

Murph

    
    A much better way to compare returns would be to express the return as
    the difference between the actual return and the S&P 500 return, and
    then subtract off inflation.  The result shows what the manager has
    really accomplished.  
    
    To compare results between funds, you should then subtract off any
    loads and management fees...  
    
    When you're done with all that, ask yourself if the good results are
    due to luck or skill...  a manager of a biotech fund did pretty well in
    1991, and pretty lousy in 1992, and can't really take much credit or
    blame for either.  So ensure that when you compare fund A to fund B
    that they are in the same investment universe (e.g. don't try to
    compare FIDELITY Select Biotech with FIDELITY Select Buggywhip!)
    
    re: Janus 20 size factor
    
        I have heard that studies support what you suspect about fund size.
        I haven't read any of these studies myself, but maybe someone else
    	who has can comment on specific guidelines.
    
    /jim
    

      I received a J20 application in the annual report as well.
      I already hold J20 so I'm not going to use this form. It
      does ask on the form what other Janus funds you own. Can
      this form be used and accepted by someone that is new to
      Janus? 

      If you're willing to try, then I have an application I won't
      be using.

      Bob