Year’s Top Fund Being Closed to New Investors

Van Wagoner Capital Management said Friday it will close to new investors its Emerging Growth Fund--this year’s best-performing U.S. stock fund--because increased inflows could crimp returns.

The closely held San Francisco-based company said that on Monday it will shut the fund, which is up more than 200% this year, capping its size at about $1 billion in assets. The fund’s assets were $325 million at the beginning of the year.

Van Wagoner also will close its Micro-Cap Fund, up more than 150% this year, capping assets at about $250 million, leaving it with three funds that remain open.

“We think it’s in the shareholders’ best interest to cap assets now, before the fund gets too big,” said Peter Kris, managing director of Van Wagoner Capital Management. “We’re a small private organization and we want to make sure we can be as effective as possible.”

The surge by Van Wagoner’s funds represents a turnaround from last year’s slide and makes it likely this will be the first year since 1996 its flagship Emerging Growth Fund will top the benchmark Standard & Poor’s 500 index.