This story appears in the
August 2005 issue of
Entrepreneur.
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If you're looking for a tech fund with a long, rich history,
the Franklin DynaTech Fund (FKDNX) is hard to top. Its
managers have invested in cutting-edge technology companies and
sought out innovative investment opportunities since the fund's
creation in 1968. In the early 1970s, that meant holding oil, gas
and airline companies. Today, it's health-care and internet
stocks that catch the fund managers' eyes.
At the end of first quarter 2005, about 28 percent of the
fund's 80 or so stocks were invested in electronic tech stocks,
24 percent in health technology and 23 percent in tech services
companies, according to Matt Moberg, one of Dyna-Tech's
portfolio managers. "The fund looks across the economy for
innovative products and technologies," Moberg says.
For investors who love a buy-and-hold strategy, DynaTech's
investment philosophy is bound to please. "For the past three
years, the turnover on the fund has averaged about 15
percent," says Moberg. "That implies a holding period of
about 6.6 years." He notes that the average tech fund's
holding period is about 12 months.
Ranked No. 1 in the Science and Technology category for the past
five years by Lipper, the risks to investors in this fund are like
those of other sector-specific equity funds--market cycles.
Dian Vujovich is an author, syndicated columnist and
publisher of fund-investing site www.fundfreebies.com.