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The Investec Guinness Flight fund family is positioning themselves as the fund family of the future. Beginning in 1994 and first introducing Asia and China-type funds, their latest fund offerings aren't regionally-based any more. Instead, they are New Economy focused and hot right out of the box.

When Jim Atkinson, Jr., head of the U.S. division of Investec Guinness Flight, first read about the Wired Index that Wired Magazine had created, he knew that he wanted to invest in all the companies represented in it. That index presented what the magazine's creators thought where the stocks that would best track the New Economy going into the 21st century and he liked their thinking.

"Fundamentally I believe that the world is changing extremely dramatically and that these changes are going to impact every aspect of our lives, " says Atkinson. "And, that to compete as a firm, we needed to be thinking more like our customers thought. They tend to want to invest in ideas as opposed to asset classes."

So, with his idea the support of his company, The Wired Index Fund,(800-915-6565), was rolled out in December of 1998. Last year the fund's total return was up 68.68 percent and ranked the No. 1 Index Fund by Lipper, Inc. This year, its year-to-date performance was up 7.3 percent through March 15.

Then, on July 30, 1999, the Pasadena-based fund family introduced the internet.com Index Fund. Its total return for 1999 was up over 82 percent. Through mid-March it was up 12. 6 percent.

Now wireless has caught this fund family's eye. On Feb. 28, they introduced The Guinness Flight Wireless World Fund. A fund that will invest at least 85 percent of its assets in companies that either have substantial business in, or stand to benefit from, the shift toward wireless communications. In its first two weeks, the fund picked up over $21 million in assets and performance was up over 2.5 percent.

I spoke with Atkinson about the launch of the Wireless World Fund. Here are parts of that conversation:

  • DV: Why a wireless world fund?

    Atkinson: I believe that the shift to wireless is a big deal. Bigger than the Internet. And what's happening is a number of things that, whenwe get done with the process, will mean that your hand held device will be more than a phone. It will be your Interment connection; your web browser; your e-mail; your telephone; your credit card; your global positioning satellite system; and a lot of stuff. There's already a company in Finland that allows cell phone users to buy soda from vending machines using their handsets and charging their cell phone accounts for the purchase.

    But right now the convergence of the Internet and the cell phone is what we really mean by the wireless world.

  • DV: I've just come back from Malaysia and everyone from the river guide on the Pimpin River to the general manager at the Ritz in Kuala Lumpur carries a cell phone. More people there than here are cell savvy.

    Atkinson: Wireless telephones have won widest acceptance outside of the United States. In Italy and Finland more people have cell phones than land lines.

  • DV: Why is that?

    Atkinson: Well, we're behind because we had a head start.

    We built out our copper wire system, (the phone line system the U.S uses) when that was the only technology around and we have a tremendous investment in that infrastructure. So, when a new and competing technology comes along---like wireless---we don't necessarily need it as badly as some other countries do. If your country is China, for instance, you're not going to bother with the copper stage, you're going to go straight to the wireless stage.

  • DV: I can hear how enthusiastic you are about the opportunities that the Wireless World Fund affords, but no fund---even index types---are risk free. Looking at the three New Economy-type funds you offer, how do they compare?

    Atkinson: The portfolios are different. The Wired Index Fund focuses on the New Economy. In it will be technology companies and companies that are big users of technology like Fedx and Charles Schwab. Only one stock I can think of that's in both it and the Wireless World Fund and that is Nokia. And because of its industry diversification would be the least risky.

    The internet.com Index Fund is a pure Internet fund. It has 50 stocks in it and would be the most risky because it's such a highly concentrated fund in one industry. And the Wireless World Fund, also concentrated but not into one industry alone, would follow the internet.com Index Fund in risk.

All of Investec Guinness Flight funds are no-load. For more information about them call 800-915-6565 or visit their website at www.gffunds.com.

To read more articles, please visit the column archive.

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