The Timothy Plan, the Pro-Life mutual fund is launching three new funds, effective July 1, 1999.

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Joining its first fund, the Timothy Plan -- which has been renamed the Timothy Plan Small-Cap Value Fund -- is a Large/Mid-Cap Value Fund,a Fixed-Income Fund, and a Money Market Fund.

Its first fund has only raked in $26.5 million in the five years since it was launched, but the funds' president is confident about the future.

Timothy president, Arthur Ally, affirmed his commitment to the strict screening of "refusal to invest in companies that contribute to [what (they) believe to be] the moral pollution of our culture through their support of abortion, pornography, or active promotion of the homosexual agenda."

Not to mention the fund's aversion to alcohol, tobacco, and gambling. We're guessing no big Vegas investments in the near future.

The Timothy Plan espouses the belief that the universe of socially responsible investing funds are primarily "fronts for promoting a "New Age" agenda."

"Most (socially responsible investing funds) screen on issues that would be considered left of center -- we're on the other side of the ledger," Ally told the MFWire. "Do (our screens) make us homophobes? No, I tell people this a lot. We just reserve the right to invest in stocks of companies that represent the same values that we believe in."

He added that the screens used eliminate only about 5% of the available stocks for its advisors.

"Admittedly, Timothy experienced weak performance in 1998, which continued through March, 1999, but this was due to a performance trough in the small-cap value market as a whole, not our screening," said Ally . "The key to good performance is good investment management and, in our opinion, we are blessed with three of the best money management firms in the industry. With Awad Asset Management (Small-Cap Value Fund), Fox Asset Management (Large/Mid-Cap Value Fund), and Carr and Associates (Fixed-Income and Money Market Funds) we believe we can stand toe to toe with any fund in the industry."

Ally predicted that small caps were about to turn around and he'd end up "whuppin'" the similar Noah Fund, another conservative Christian Fund, adding that he had just had dinner with the Noah Fund's founder and manager Bill Van Allen recently. The Noah Fund is a large-cap growth fund with a five-star rating from Morningstar.

Managed since 1997 by Carol Egan, Dan Veru, and James Awad, the chairman of Awad Associates who also manages the Calvert New Vision Small Cap Fund, the Timothy Plan offers both a 5.5% front-end load and a 5% deferred load, with an expense ratio of 160 basis points. On a total return basis, the fund ranked 1,728 within the entire universe of 1,771 funds in the Domestic Equity category, according to S&P.

The funds will be adding a C share to its offerings as well, and changing its administration from Declaration to Unified Fund Services, Ally told the MFWire.

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