The BearGuard Fund, the flagship mutual fund of Skye Investment Advisors of Los Gatos, Calif., is asking shareholders to approve liquidation of the fund at a meeting March 21.
The fund is one of about a dozen mutual funds which invest according to a "bearish" investment philosophy which entails "shorting" securities that the manager believes will decline in price. The proposed liquidation was disclosed in a March 1 proxy statement filed by the fund.
The $2 million no-load fund had "been unsuccessful in building assets to an economic level," the proxy said. The lack of assets would probably prevent the fund from operating at an efficient expense level in the future, the proxy said.
The BearGuard Fund, which was introduced in November, 1999, employed the same bearish investment style that its advisory company had used for 12 years. The fund assembled a basket of 75 stocks that the manager believed were overvalued.