Fidelity making 161 additions to FundsNetwork 'Responding to customer demand'

November 12, 1996|By BOSTON GLOBE

BOSTON -- Fidelity Investments is adding more funds to its version of a mutual fund supermarket, a business that is most closely associated with Fidelity's rival, Charles Schwab Corp.

Fidelity said that, as of Friday, it will have 161 new funds from 41 fund families in its FundsNetwork program. The program allows customers to buy mutual funds from Fidelity and a wide range of competitors.

With the new additions, FundsNetwork will have 3,300 funds from more than 300 fund families. Of that group, 621 funds will be available without paying a transaction fee to Fidelity; the rest of the funds have fees associated with them.

"Fidelity is responding to customer demand for more funds through additional fund families," said Sam Jensen, vice

president of FundsNetwork. The supermarket concept has become increasingly popular. Investors can pick and choose among a wide group of funds and buy and sell those funds with far less trouble than before, say investment specialists. "It's a lot easier to pick up the phone and call one 800 number than five or six different ones," said John Bonnanzio, editor of FundsNet Insight, a newsletter.

Schwab, based in San Francisco, pioneered the supermarket through OneSource, which it created in 1991. OneSource already has $33 billion in mutual fund assets. The program offers about 600 retail funds without transaction fees and another 800 DTC with fees.

Fidelity said yesterday that its FundsNetwork currently services

more than $38 billion in non-Fidelity assets, up from $23 billion at the end of 1995.

The success of the supermarkets has inspired a good deal of imitation. Several leading Wall Street firms have announced plans to create their own supermarkets in an effort to grab a piece of the mutual fund business. Smith Barney Inc. has already launched a supermarket. PaineWebber Group Inc. and Prudential Insurance Co. are said to be readying their own versions of the product.

Among the new fund families that will be added to Fidelity's supermarket this week are Brinson, Seneca, Value Line and Third Avenue.

Pub Date: 11/12/96

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