Rick Sapio, the ceo of Dallas-based 1-800 Mutuals, Inc.
, had a problem. His company had built a proprietary asset allocation model as a tool for FAs to allow mutual fund investors to sift through the glut of funds on the market and find the best ones for them. But somehow the message wasn't getting out as quickly as he would have liked and he wasn't seeing enough of the front line investor.
With everyone and their brother chasing hot money from stock to stock, 1-800 Mutuals was simply not getting enough exposure. But recently Sapio and his board decided to launch start their own family of funds in order to gain needed eyeshare of the general public.
Within the next two months, 1-800 Mutuals will launch their first two funds, a quasi-index fund named the Technology 20 fund, which will invest in large-cap tech stocks and the Generation X fund, a fund-of- funds which will loosely follow the investment philosophy of Harry S. Dent, author of The Great Boom Ahead
and The Roaring 2000s
. Sapio stated that although the funds will certainly be launched soon, the names might change but the investment philosophies will remain the same.
Dent has predicted that we can expect about 9 more years of prosperity, primarily because of the baby boomer demographic and their spending habits. Following this philosophy, the Generation X fund will invest primarily in funds that invest in "distinct sectors of the economy which are likely to be positively impacted by baby-boomer spending activity." Sapio says that the initial concentration will be in health care, technology, international and financial services, sectors represented in 1-800 Mutual's Generation-Wave Aggressive Growth Portfolio.
Each of the funds will be offered through the larger NTF platforms, so each will carry .25% distribution fees. The Technology 20 fund expects a 50 basis point expense ratio, with the Generation X carrying 150 basis points. The transfer agent for both funds will be the Declaration Group.
1-800 Mutuals is at present a privately held company and is in the process of raising private capital.
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