It was only a matter of time before someone created an interactive mutual fund.

Two former executives of Barclays Global Investors have started their own mutual fund called the OpenFund that will allow anyone with Internet access to view all of the fund's trading at the fund's web site,

The fund's organizers have set up a video camera on the fund's trading floor in San Francisco that is connected to its web site. The fund's portfolio managers can be seen peering at computer screens and working the telephones through the so-called TraderCam. A separate screen on the site posts all trades as they are made, and the fund's managers post messages explaining why the trades were made.

"We're trying to tear down the walls between consumers and (portfolio) managers," said H. Davis Nadig, co-founder and executive vice president of

At 1:22 p.m. PST on Sept. 7, OpenFund sold 1,500 shares of S&P Depositary Receipts at $164.68 a share, and the trade was reported on the web site as it happened.

"We executed an additional sale of Spiders at the market price to pay for purchases of Broadcom and Conexant near the close today," fund manager Maurice Werdegar wrote on the site after that trade. "Spiders" is the nickname given S&P Depositary Receipts, which go by the acronym SPDR. SPDRs are unit investment trusts that track the performance of the S&P 500 index.

The fund has already brought in $4.3 million since Sept. 1 - the day it was introduced - that Nadig says is mostly from family and friends of co-founder Donald Luskin and himself.

Investors will also be given the opportunity to voice their opinions about OpenFund and moves made by its managers. The site will have discussion boards and chat rooms to facilitate discussion about the fund. One of the discussion boards will be run by electronic commerce experts such as Nicholas Negroponte, co-founder and director of the Massachusetts Institute of Technology Media Laboratory in Cambridge, Mass.

OpenFund's designers named the fund to reflect a sense of populism that the fund embodies, Nadig said.

"We've closed no doors," Nadig said. Even non-shareholders will be able to participate in the fund's message boards, he said.

OpenFund is not an Internet fund, but invests in companies that are driving the so-called "new economy," which are companies that are benefiting from advances in technology, Nadig said. As of Sept. 7, its investments included America Online, Dell Computer Corp., Walt Disney Co., Home Depot Inc. and Yahoo! Inc.

The OpenFund is currently's only mutual fund offering, but the company has filed with the SEC to create additional funds. However, Nadig says that those products will not be introduced soon. While MetaMarkets has registered the trademark, "The first interactive mutual fund," the mutual fund industry as a whole has become increasingly interactive as it uses the Internet more to help connect with shareholders.

An investment adviser in New York City called Privateer Asset Management has registered a mutual fund with the SEC called the Allied Owners Action Fund that allows investors to talk on its web site about the stocks that the fund has bought.

United Asset Management of Boston announced this month that it will be broadcasting portfolio manager conference calls live on its web site and is also posting transcripts and audio tapes of the meetings on the site for those who could not hear it live.

The OpenFund is sold without a load, directly through the site, where shareholders can buy and sell fund shares online and receive all literature and communications by e-mail. The fund has an annual operating expense of 1.45 percent, but the fund's manager is waiving management fees and paying all other fund expenses through February 2000 to attract investors.

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