What do you call some 900 mutual funds liquidated or merged out of existence? A good start. That bad joke and a bit of grave-dancing is called for, however, in reviewing the issues...

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What do you call some 900 mutual funds liquidated or merged out of existence?

A good start.
That bad joke and a bit of grave-dancing is called for, however, in reviewing the issues that met their demise in 2004.

And so, in the spirit of the year-end retrospectives showing famous people who met their end during the year, here are the most noteworthy fund passings of 2004.

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The Lindner Funds. This fund firm was built on a terrific 15-year track record from 1980 through 1995, thriving on a low-cost, value-investing style.

But when Kurt Lindner died in 1995, his replacements proved horribly inept.

Over the past decade, the Lindner funds went through a series of consolidations, new investment objectives, manager changes, executive overhauls, ad campaigns (something Lindner himself hated) and more. The only constant was wretched performance, some of the worst for the entire industry.

• Stable-value funds. A popular pick with retirees, stable-value funds bought high-quality bonds, and then used insurance contracts to keep share prices steady.

Alas, regulators were concerned about how the insurance affected a fund’s net asset value, noting that some potential price fluctuations might not have been showing up.

Wanting to avoid a tango with regulators, fund firms including Oppenheimer and Eaton Vance killed off their stable-value issues. Bury this one under “sounds too attractive to be true.”

The Watchdog Fund. Started in the wake of Wall Street scandals, the idea here was a form of “ethical arbitrage.”

Management planned to buy stocks where improved governance would heighten profits, and to become an active advocate for making those changes. It also invested in stocks with good governance and sold short issues where management was beyond hope.

While no investor is “against” good governance, few seemed in favor of investing for it. Lacking a more pronounced social agenda, consumers quickly wrote Watchdog off as a gimmick. It was the right call.

The IPS iFund. Designed to be run entirely by its shareholders, the iFund was more investment club than small-cap growth fund.

The idea was based on “complexity theory” — the idea being the more connectivity between investors, the greater the level of expertise and, thus, the better the performance.

Unfortunately, as with most “shareholder-driven” funds, it didn’t work that way. Performance was dreadful and investors grew disinterested. The manager, who once vowed to remain open indefinitely, apparently felt the same way and shuttered the fund in October.

The WWW Internet Fund. Opened in 1996 as the first mutual fund trying to cash in on the Internet boom, the fund was liquidated this fall when it could not sustain the 70 percent rebound it posted in 2003.

Manager Lawrence York said in January that he expected another terrific year for Net stocks, but less than nine months later — having lost 12 percent in 2004 — he cited massive losses and shrinking assets. Assets, which peaked at about $150 million during the bull market, stood at about $10 million at the end.

Chuck Jaffe is senior columnist at CBS Marketwatch. He can be reached at jaffe@marketwatch.com or Box 70, Cohasset, MA 02025-0070.