changing funds

[Guest alex]

I would like to know about the two funds that I have in my 401k potofolio and for the last year these funds Fidelity Advisor Equity Income Fund and Fidelity Advisor Growth Opportunities funds are underperfomed the market I need from you the future for year 2000.Question Should I keep them or sell them.And what do you think about Neuberger Berman Genises Trust?

Thanks.Alex

[This message has been edited by alex (edited 01-24-2000).]

[Guest GregSelf]

Alex:

If you're looking for free investment advice, remember this...it's usually worth what you pay for it. Your plan sponsor (i.e., your employer) likely has an alliance with a record-keeping and/or consulting firm that may be able to offer you some information from a paid investment advisor. Check there first.

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[Jon Chambers]

1) No one knows what will happen with these or any funds in 2000.

2)These Fidelity Advisor funds have 0.25% 12b-1 fees attached (assuming you are in class A shares). I prefer funds that don't have these 12b-1 fees.

3)Equity-Income and Growth Opportunities are both Large Cap Value funds, so comparing them against "the market" is nonsensical, if you are using the S&P 500 to proxy the market. Relative to other Large Cap Value funds, the two funds performed in the 65th and 61st percentiles respectively in 1999. Over the trailing three year period, the funds performed in the 45th and 19th percentiles. Over the past one and three year periods, both funds underperformed the S&P/Barra Large Value index.

3) These two funds have relatively similar characteristics. If they are your only two holdings, you are not particularly well diversified.

4) NB Genesis has historically been a top-performing small cap value fund. Due to its relatively low turnover, it has drifted to the small cap blend category. It has underperformed the average small blend fund over most review periods (one, three, five years). It has also underperformed the Barra Small Value index over these periods.

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Jon C. Chambers

Principal

Schultz Collins Lawson Chambers, Inc.

(415) 291-3004

[Guest GregSelf]

Jon

I was under the impression that Class A shares of retail mutual funds typically have front-end loads on new money as it comes in. Whereas Class B shares have the 12b-1 fees based on the fund's assets (possibly combined with a CDSC schedule) These 12b-1 fees are deducted annually - reflected in the fund's NAV - as a way for the fund managers to recoup their costs of paying all the sales commissions to their broker/dealers up front. Is that not correct???

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[Jon Chambers]

Hi Greg. Class A has both a front end load (sales charge), and a relatively low 12b-1, or "trail". Class B has a back-end load (CDSC), if you sell before a prescribed date (typically 5-7 years), and a higher 12b-1 fee. Most qualified plans offer Class A shares, and waive the front end load. The broker (if there is one) receives a much lower payout on the load-waived Class A shares. Typically, there is no broker, and the 12b-1 is used as a revenue share to the plan trustee and/or recordkeeper.

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Jon C. Chambers

Principal

Schultz Collins Lawson Chambers, Inc.

(415) 291-3004

[Guest GregSelf]

Jon:

Thanks for the info!!! Very helpful.

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[GBurns]

For what reason is this "revenue Share" paid. For services rendered?? Sales commission? Under whose NASD license is it paid?