David Snowball, PhD, publisher of MutualFundObserver.com, an independent mutual fund–analysis website that tracks 36,000 investment products. He also is professor of communications studies at Augustana College, Rock Island, Illinois.
One of the better stock funds for today’s volatile markets is the T. Rowe Price Capital Appreciation Fund (PRWCX). But: It has been closed to new investors for nine years.
In fact, nearly 300 funds are closed so they don’t grow too big for managers to invest effectively. If it’s any consolation, you probably don’t want to own most of them—performance tends to weaken after closure. But if you really want in, here are strategies to try…
Ask a shareholder to gift you a share of the closed fund. After that, you typically are allowed to invest in more shares yourself.
Invest directly with the fund company. New investors can’t buy shares of the Seafarer Overseas Growth and Income Fund (SFGIX) through a broker like Charles Schwab—but you can if you open an account at Seafarer Funds.
Roll over your 401(k). T. Rowe Price Capital Appreciation Fund (PRWCX) is available to new investors who establish an IRA with the company, then move their retirement plan assets into it.
Sneak in through an employer-sponsored retirement plan. Fidelity Growth Company Fund (FDGRX) remains open to workers through many defined-contribution channels.
Invest in other funds in the same family. If you have $250,000 or more in Artisan funds, you’re allowed into the closed Artisan High Income (ARTFX) and Artisan International Value Fund (ARTKX).
If these strategies don’t work for you: Write a letter to the head of client services or sales explaining that you want to establish a long-term position in the fund.