From: Chris.Hynes@bbs.oit.unc.edu (Chris Hynes)
Newsgroups: misc.invest
Subject: 20th Century---the real story
Summary: setting the record straight
Date: 12 Oct 92 01:46:43 GMT
Distribution: misc
Organization: Extended Bulletin Board Service


	As a 20th Century investor for 5+ years, I must set the record
straight.  Nobody talked about Twentieth Century until late 1991 when
Ultra Investors enjoyed a tremendous return (from October 1990 - October
1991, Ultra increased in value by 101% -- that is 20th Century's
traditional fiscal year).  All of the other stock funds enjoyed 30% or
better returns in that same period and the bond funds were in double
digits.  Just after that happened, billions of dollars from foolish
short-term thinking investors began to flood Twentieth Century and the
value of its funds doubled within the year. 
	20th Century's investment strategy is simple and consistent with
my own beliefs.  They believe that if you buy stock in good companies with
accelerating earnings and hold them, you will certain weather all the
economic storms and come out on top.  This is what 20th Century has done. 
I don't know all of the figures, but two of them seem to stand out.

	1>  Ultra investors was the top performing fund for the five year
period ending December 1991 with an average annual return of 47%.

	2> Growth Investors, one of its oldest funds, is the #1 performing fund
for the 20-year period ending December 1991.  This is not a twisting of
the facts, this is true.  For those of you screaming, "What are Fidelity
Magellan?"  Here are the numbers:  

	Average anuual return (Dec 1971-Dec 1991)
		#1:  Growth Investors--20th Century      20.8%
	        #2:  Magellan Fund--Fidelity             20.2%
     		#3:  Select Investors--20th Century      19.0%

What these numbers don't tell you is the one major drawback that this
company has that especially hurts the short-term thinking,
bandwagon-jumping investor.  If Ultra investors went up 101% each year,
who in their right mind wouldn't be going to 20th Century.  When things
sound too good to be true, they usually are.  Due to the fact that 20th
Century takes a long-term view by holding the stocks it deems to be of the
highest quality, it is subject to tremendous volatility.  The best article
I have read on the subject appeared in the Wall Street Journal on February
10, 1992 on the front page of the "Money & Investing" section.
	President James Stowers, Jr. says, "The problem with peoplr is they get
too darn impatient."  He says that people should have a horizon of 5 to 10
years or more when making an investment decision.  A 20-30% quarterly loss
is not unusual, I should know, since Ultra investors is down nearly 18%
since January and down 22% since a high in February.  
	One person posted news saying he had invested when Ultra was at
18.40 at the beginning of the year and it was at 14.30 now.  Well, what
did you expect when buying Ultra after it had gained 101% the previous
year.  Also, if you had dollar-cost averaged all along, you loss would be
smaller, you average share price would be more around the level of 16.00 and
you would be poised to make some real gains.  I also object to the
statement that the company showed profit last year, but probably won't
this year.  Well, let me explain something to you.  20th Century is a
no-load fund whose income is generated by a management fee which is %1 of
the dollar value of all shared on a given day (%1/365 per day).  20th
Century does not lose money just because its investors may be losing
money. 20th Century will once again post a profit this year, mostly from
management fees from people who flooded the company in January, pulled out
in April leaving a bounty of fees.
	Another question I need to address.  One reader said that they objected
to the fact that Ultra had grown so much in recent years and how that was
going to lead to Ultra becoming a big-company fund.  WRONG!  That just
means they will have to own more shares of high quality companies.  It's
simple.
	So, if anyone out there is planning on investing in a company that
doesn't churn the market or chase down fast fluctuations in the market,
then 20th Century is the right place for you.  For those of you with a
fondness for the Reagan Era that borders on the sickening, keep hopping
from one star fund to another, keeping buying high and selling low, but
don't come to me to borrow money when I retire with a generous nest egg.


	For the rest of you out there with strong convictions about how
investing should be, 20th Century is a great place for people, even of
very modest mean (like me), to buld up a nest egg that grows in amazing
proportions over the long term.  There is so much ignorance (meant kindly)
of investing, especially among people who are not very well off.  They
think that investing is for the rich exclusively.  This is not true,  but
it is very difficult to convince people who fear the investment world. 
Everyone is out to get your money, trust me.  By going to a no-load mutual
fund, you are your own financial advisor, and you are in supreme control
of your money.  At 20th Century in particular, there is no minimum
investment, no minimum withdrawal, no hidden fees, no penalties, and a low
minimum balance requirement of $1000 which is only effective on December
31 of each year.  You can carry a low balance all year and pay no fee.
	I sound like a representative for Twentieth Century sometimes.  I
feel passionately about their investment philosophy, and although I get
nervous sometimes, I have been very pleased with my results.  I plan on
staying with 20th Century for years to come.  

	I appreciate responses to my posting and would like to hear from
anyone who wishes to take the time to respond.  I am very concerned about
the fact that 55% of Americans have zero or negative savings.  I am very
concerned about the low savings rate of our country as well as our
national debt.  I am concerned about educating poor and low income people
about the investment opportunities that exist for them. If someone earning
15,000 a year could just find a way to cut corners, spend wisely, and
tighten their belts enough so they could just save $1,500 of that (10%) a
year, they would be so much better off in the future, I cannot even begin
to tell them how much.  Anyway, enough of my lecture.  Good luck to
everyone.  Happy investing!


e-mail:
	-mantis@uncvx1.oit.unc.edu
 




	

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