31 October 1999

In brief: The Close FTSE Techmark fund will invest in British technology firms. It will track the new Techmark index which will be launched by the Stock Exchange tomorrow.

Fees: Initial charge of 4.75%, discounted to 3.5% during November. Annual management fee of 1.15%.

Minimum investment: £1,000 lump-sum or £100 a month.

Evaluation: The Close fund is the first to invest solely in British-based technology firms. It will track the index, similar to the FTSE 100 but composed entirely of young, dynamic technology-based companies. The fund can also be held within an Isa so gains are tax free. Marc Gordon, managing director of Close Fund Management, says: "An index-linked tracker fund removes the risk of having to pick individual shares, which is particularly difficult among small technology firms."

However, technology shares are very risky and this is not an investment for the faint-hearted. Financial advisers recommend that this type of investment should only be bought for the long term (at least five years) and as part of a much wider portfolio. The costs are also lower than for other technology funds. They tend to charge an upfront fee of more than 5%, and an annual fee of 1.5% - compared to 4.75% and 1.15% at Close.

Nevertheless, the Close fund looks expensive compared to other trackers, which usually charge no upfront fee and an annual charge of less than 1%. It is no more expensive for a fund manager to track the Techmark than the Footsie, so there is no reason why investors should be charged more.

Calls: 0800 269 824