Amidex Funds Inc., a small Pennsylvania fund family, is preparing a personal security and national defense fund in an attempt to benefit from the spike in interest about defense and security products.

The Amidex Security and Defense Fund, which was sent to the Securities and Exchange Commission for review on Oct. 30, would be the second sector fund to invest in national defense and the first to invest in personal security companies. The portfolio, which is expected to be launched early next year, would be sold through 75 to 80 broker/dealers nationally, including large banking companies such as Wachovia Corp. and Deutsche Bank.

Cliff Goldstein, president of the Conshohocken, Pa., fund family that manages $10 million, said he has been considering a security and defense fund for years but "stepped up" production of it in response to the Sept. 11 attacks.

"We want to stay ahead of the curve," Mr. Goldstein said in a recent interview. "Other fund companies are eyeing defense companies. There are probably a dozen defense funds in the works. We think their stock prices will be inflated. Investors need a mix of defense and personal security."

Mr. Goldstein, who formerly practiced law in Pennsylvania, started Amidex three years ago. The fund will invest in personal security companies that deliver such services as airport and personal security or novel products such as fingerprint and retina scanners. He said he believes these companies will be popular with conservative bank investors.

Currently, only Fidelity Investments, with its Fidelity Select Defense and Aerospace Portfolio, offers a defense-sector fund. Begun in 1984, it manages $151.7 million. Sarah Friedell, director of media relations at Fidelity, said that since Sept. 11 the fund’s flows have been very positive.

Geoffrey Bobroff, a mutual fund consultant in Providence, R.I., said that, much as sector funds focused on energy companies became popular last spring when fuel prices spiked, funds focusing on defense could have their day. But since defense companies are not traditionally considered growth stocks, Mr. Bobroff said he does not know how long their moment in the sun could last.

"This is an interesting area and an interesting product, but it relies on such negatives," Mr. Bobroff said. "Of course, that doesn’t mean that people won’t make a fair amount of money out of it."

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