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CNN Live Today

Online Sources for Funds

Aired June 28, 2002 - 10:33   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CATHERINE CALLAWAY, CNN ANCHOR: And as we just mentioned, WorldCom is announcing the first of its layoffs today. In all, the company will slash 17,000 jobs. That’s about 1/5 of its work force.

But the losses extend beyond WorldCom’s payroll, The former darling of Wall Street also dragging down investors who may not even know they own a chunk of it.

Let’s go to CNN’s Miles O’Brien to tell us more about this.

You know, Miles, if you have a mutual fund, it’s a little scary.

MILES O’BRIEN, CNN CORRESPONDENT: It’s scary, and it’s also sometimes difficult, if you don’t do a little bit of homework to find out if your mutual fund is still invested in the likes of WorldCom, or Xerox or Martha Stewart for that matter.

Whatever you’re interested in, you have to do a little bit of homework if you’re invested in one of the big funds. Here’s one way to do it.

And we picked Yahoo!, just randomly, Yahoo! Finance. You can go to any other place you like. This is not meant as an endorsement in any way of Yahoo! or any of these sites. We just picked it because it was relatively easy to load up in the computer this morning, although, relative, with computers, is a word which is of some debate.

Anyway, go to Yahoo! Finance and check in the area which allows you to enter the symbols for various stocks, and also mutual funds. You’ll need to find out the symbol for your particular mutual fund if you want to find out.

We loaded in the top five WorldCom holders: Vanguard Windsor, the Vanguard 500, the Oppenheimer Quest, the Hartford Capital Appreciation, and the Vanguard Prime Cap.

Now, you might want to listen up, if you have any of these particular funds, because these funds are heavily invested in WorldCom.

Now, let’s just check out Vanguard Windsor, for example. Now, when you go to that particular site, you get some broad-brush information. You see how the fund has been doing over recent memory -- actually kind of mirrors the stock market. By the way, we didn’t put up the Web site. It is yahoo.com in case you were curious about that.

And then you can go from there to the place where it says holdings. All right. Oops, let’s clear that out and put in holdings right there. Click on that particular thing, and it will take you to this.

Now, take a look at where it says top holdings here, and this is where the grim news is, if you happen to have the Vanguard Windsor fund. Number three on its list: WorldCom. A little more than 3 percent of its portfolio.

And of course, as we know, we’ve been telling you, WorldCom is now registering an 88 percent loss.

Now, let’s move it along a little bit to the next fund. We’re going to check out, for example, the Oppenheimer Quest fund.

Similar story. There’s the big picture. Punch on holdings. Go to WorldCom. Number two on the list: 5.5 percent of the fund, once again at 88 percent loss.

So that gives you a sense of how that particular stock might be impacting your mutual fund.

Now, if you want to find out more -- if you’re sort of in the buying mode, selecting mutual funds, go to a place like eTrade. Once again, we picked this sort of randomly. There are other places out there to do this. But when you go to eTrade and just start doing your homework on these things, there’s an entire section devoted to mutual funds.

Let me give you the URL for that, by the way -- etrade.com -- very straightforward.

And as you get in a little deeper, it has things like power search, will allow you to go through and pick mutual funds by all kinds of criteria -- international stocks, United States stocks, aggressive growth, things that are a little more conservative.

And as you go it, one place to look at is their all-star list. This is their -- by their criteria. All kinds of things are put into this -- and it’s a bit subjective, but it basically tells you, based on various sectors, which funds they like.

And as you pick one -- I picked the Vanguard Growth Index. If you go in there, it’ll take you to the dreaded prospectus, and the prospectus, Catherine, is where, if you can keep yourself awake and read it. You will find out exactly what that fund is all about and what holdings it has.

So a little due diligence required on the part of investors to find out if their mutual fund is adversely impacted by all of this.

CALLAWAY: You know what, though, Miles? After the last couple of weeks, we are all wide awake trying to look at this. Especially Vanguard is especially disturbing because that has been one of the most popular, certainly one of the highest rated and safest mutual funds out there.

O'BRIEN: Well, I mean, we’re not saying this is unsafe and you should be, you know, selling your mutual funds right now. Most people in mutual funds as long-term investment anyway.

As we just told you, we picked a couple of the top-holders of WorldCom. We’re still only talking about 5 percent of the fund itself. The funds are down, but the whole market is down, so it’s difficult to kind of cull out what portion of that downturn is linked to the likes of WorldCom.

CALLAWAY: All right. Thanks for putting it in perspective for us so people won’t run away from the mutual funds.

Miles O’Brien.

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