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- Investing
By Rob Silverblatt
When mutual funds step off the beaten path, there's no telling what
will happen. In the past, for example, oddball funds have fought the war
on terror (the
Here are the 10 quirkiest funds we could find:
The Congressional Effect Fund (CEFFX)
This fund exists to answer the question posed in enormous letters at the top of its
website: "How much investment wealth does
The StockCar Stocks Index Fund (SCARX)
At first glance, this fund, which tracks an index of companies that support NASCAR's Sprint
Cup Series, is a dream come true for racing fans. But a more careful look reveals a different story -- most
of its holdings are only tangentially related to
"[You have] two or three
legitimate
The Blue Chip Winery Fund
Jokingly called the best "liquid" investments on the market, wine funds once enjoyed some popularity. But unlike a good glass of wine -- or investment, for that matter -- these funds have usually not gotten better with age, and most of the ones that were around several years ago have since crashed and burned. Nevertheless, this fund, which was launched in October and is based in the Bahamas, takes a bit of an untraditional approach to wine investing: Instead of buying actual bottles of wine, it will invest exclusively in real estate holdings like wineries and storage facilities. In particular, the fund's management is looking to take advantage of the cheap property prices created by the recession. "Given the current economic environment, there are a lot of [opportunities]," says comanager Bruce Ramsey. Aside from the chance for capital appreciation, investors can look forward to the perks that this quirky fund offers, including discounts on food, hotel rooms, and spa treatments at select wineries. According to the fund's website, shareholders also get first dibs on the wine produced at these properties and the chance to "help pick grapes, prune vines, and taste-test the wines as they progress from juice to bottled wine."
The Herzfeld Caribbean Basin Fund (CUBA)
While most
managers talk about investing with long time horizons, few are willing
to stake large chunks of their fortunes on an event that may never
happen in the lifetime of their funds. But for the past 15 years, fund
manager Thomas Herzfeld has been doing just that as he
patiently waits for the Cuba embargo to come
crashing down. Along the way, Herzfeld has chosen stocks for this
closed-end fund based largely on companies' prospects for success should
the embargo be lifted. While he also holds significant positions in
Mexico, Herzfeld is particularly keen on investing
in U.S. companies that could explode in value if the United
States and Cuba begin trading. Gimmicks
aside, the fund looks for companies that can also hold their weight in
the current political environment. Its top holding, for example, is
The Marketocracy Masters 100 Fund (MOFQX)
If you're a mutual fund
investor, chances are there has been a time when you've loudly ranted
about how you can do a better job than your fund manager. With this
fund, you get the opportunity to be your own manager -- at least kind of,
and only if you beat out thousands of other investors. On
Marketocracy.com, investors create hypothetical online portfolios;
currently, there are roughly 30,000 active users. Of the portfolios they
produce, Marketocracy takes its favorites -- up to 100 at a time -- and uses
them to select the Masters 100's actual holdings. If your model is used,
you get a small piece of the action. Manager Ken Kam
says the fund's team vets the model portfolios thoroughly to weed out
investors who are successful only by way of a fluke. "There's a lot of
checking to make sure that it's not the result of one or two great stock
picks over the last five years. We like to see good stock selection and
good trading ability," he says. Overall, this quirky approach, which
looks to achieve unparalleled diversity by blending many styles, has
paid off at times, but its annualized returns over the past five years
put it in the bottom quartile of
The Vice Fund (VICEX)
As its name suggests, this fund
invests in "sin stocks," and its list of top holdings is littered with
companies that conscientious investors love to hate: '
British American Tobacco,
and
Mixed in with these big names in tobacco are defense and weapons giants like
The Monetta Young Investor Fund (MYIFX)
Ever wonder what would happen if you put your third-grade child in charge of a mutual fund?
It's no coincidence that those companies are among this fund's top holdings. And while Monetta doesn't literally have an army of elementary school students serving as its stock pickers, one of its stated purposes is to act as if it did. That's because the fund, which invests half of its portfolio in exchange-traded funds and other index funds and the other half in companies that are familiar to young children and teenagers, looks to help parents get their kids interested in investing. Apart from picking stocks that kids readily recognize, the fund offers to mail shareholders finance-related games and activities for children and lets families accumulate rewards points that can help pay for college tuition. If its recent performance holds up, Monetta Young Investor's returns can also go a long way toward anchoring college savings: So far this year, the fund is up 48 percent.
The Timothy Plan Aggressive Growth Fund (TAAGX)
Have you ever wanted a complimentary moral audit? On this fund's website, that's only one of
several services offered to potential clients who are interested in
investing in accordance with Christian values. There's also a "Hall of
Shame," which lists companies the fund avoids, and a section to help
parents identify potentially offensive video games. Like the other
Timothy Plan funds, the
The Adaptive Allocation Fund (AAXCX)
With its website,
which is www.unusualfund.com,
this fund seems to be begging for inclusion in this list. Since the
fund's adviser is a company called Critical Math, it unsurprisingly
takes a rather formulaic approach to investing. In fact, the fund, which
launched in 2006, uses upwards of 80 "fundamental" models -- in addition
to a number of "technical" models -- to decide where to invest. With these
models, the fund's managers take the jack-of-all-trades approach to a
new level, giving themselves the ability to invest any portion of the
portfolio in essentially any type of security for as long of a time
period as they see fit. In its brochure, Critical Math proudly declares,
"Because we are so flexible, and our investments can be invested in
almost any combination of assets, the funds we advise could, at any
point in time, be classified as money market funds, or government
securities funds, or large cap growth funds, or large cap value funds,
or mid cap growth or value funds, or small cap growth or value funds, or
balanced funds, or growth and income funds, or, even rarely, long-short
funds!" Whew! Despite the fund's attempts to avoid characterization,
The Women's Leadership Fund
Swiss company
CAREERS | INVESTING | PERSONAL FINANCE | REAL ESTATE
The 10 Strangest Mutual Funds
© U.S. News & World Report