If two of the most important people in a business are the owner and the customer, then every mutual fund investor is a VIP twice over.

The minute you or I put our money into a fund, we become both a paying client and a part owner of the enterprise. That's what "mutual" means.

This is more than prospectus boilerplate. By rights it should be the principle that always guides how investors look at their fund investments.

I don't mean that this exalted status gives you or me license to demand special treatment, mistreat the staffers who answer the fund's telephones, or otherwise behave like louts.

But it does entitle us to expect good service consistent evidence that the fund is run on our and the other investor-owners' behalf. Fund management firms and their employees can lose sight of that target if they get too busy serving a) themselves or b) a bureaucratic set of rules and regulations.

When these errors of priority arise, competition provides the best remedy. As long as there are dozens of big, well-established fund groups to choose among, you needn't live with any that consistently let you down.

Still, the vote-with-your-feet method sometimes has its drawbacks. When you leave a fund you own via a standard taxable account, Uncle Sam will want his cut of any capital gain you realize. Employer-sponsored 401(k) plans, which avoid tax snags, usually limit your choice of other funds.

Speaking up

So in some cases you have to take other avenues, such as beefing to fund management. Herewith a few thoughts on what to watch for, in either the service you receive or the attitude with which the fund manager invests:

- The "just following the rules" deflection.

Investors may run into this when, say, they try to get their money out of an account. "Sorry, sir, I can't do a redemption without a signature guarantee."

It's your obligation as an investor to know the established rules going in, and to follow them. No "just this once" exceptions. Fund representatives aren't serving you, though, if they make it their mission to prevent the transaction. The objective should be to find the most efficient method, within the rules, of getting the money into your hands as quickly and conveniently as possible.

- The statistical stonewall.

Instead of describing the results they achieve with your money as a simple gain or loss, fund management often measures itself against a market index or "peer group" average of funds with similar strategies.

At their best, these comparisons provide useful context. If a fund is down 20 percent while the stock indexes are down 40 percent, you may have reason to applaud rather than grumble. Certainly you should never dump a fund for a short-term run of poor performance without looking closely at the circumstances in which it occurred.

Beware, though, of a management that begins to see relative returns as its reason for being. The point of a mutual fund is always to do well by its shareholders.

- The "not our style" excuse.

This grows more and more common nowadays: "We showed disappointing results last year because our value/growth/small-cap/whatever style was out of favor."

Style classifications, a perfectly reasonable idea when introduced a while back by Morningstar Inc. and other independent research firms, in the hands of some fund managers and investment planners have been turned into obfuscatory baloney.

Be leery of anybody who makes too big an issue of "style purity."

Puzzling over whether to invest in "growth" or "value" funds, for instance, may yield very little benefit. Over the last five years, the Vanguard Growth Index Fund was hot for a while, and then it was the Vanguard Value Index Fund's turn. As of the end of May 2001, one (Value) showed an average annual return of 14.77 percent since May 31, 1996; the other (Growth) 14.45 percent. Some difference.

Yes, on paper these two funds own different kinds of stocks. But the categories are fluid, and stocks in general don't fit into pigeonholes.

Chet Currier is a columnist for Bloomberg News.

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