If there is such a thing as a triopoly - an industry dominated by three companies - the mutual fund industry had it last year with regard to fund sales.

Three firms accounted for two-thirds of the mutual fund industry's net sales for long-term funds last year, according to Financial Research Corp. of Boston, the fund tracking and consulting firm. The Vanguard Group of Malvern, Pa., Janus of Denver, Colo. and Fidelity Investments of Boston accounted for 31 percent, 21 percent and 14 percent, respectively of the $145.5 billion in net sales of long-term mutual funds for 1999, FRC said in a report Feb. 7.

The concentration of sales among the top three firms is a change from recent years, according to Christian Cavanaugh, a research analyst at FRC who wrote the report. The top three firms in 1998, for example, accounted for only 32 percent of net long-term fund sales, Cavanaugh said. The top three firms constituted 28 percent of net sales in 1997, according to FRC data.

"1999 was a big departure," Cavanaugh said. "It was a leap."

A review of FRC data shows that sales were far more dispersed among top firms in recent years. The top 10 firms in 1998 accounted for only 59 percent of net sales in long-term funds, according to FRC. The top 10 selling firms in 1997 generated only 52 percent of net sales, according to FRC. In 1999, the top ten sellers accounted for 104 percent of net sales. The total is reduced by net redemptions from other firms.

Sales were so concentrated among top firms that Janus Worldwide, Janus' third best selling fund, with net sales of $5.1 billion, outsold all but nine fund complexes last year, according to FRC figures.

Overall, more fund complexes had net redemptions last year than net sales, according to FRC. The firm found that 336 fund complexes suffered net redemptions in long-term funds for the year. Seventy-eight complexes had essentially constant sales, with no meaningful net redemptions or sales. Another 294 firms had net sales, according to FRC.

The concentration in sales was not limited to fund firms. Investors disproportionately favored domestic equity funds, FRC reported. That category of funds accounted for 97 percent of net sales last year.

The three top selling funds last year - the Vanguard 500 Index, Alliance Capital Management LP's Premier Growth Fund and Janus Twenty - fell into that investment category as did eight of the top 10 funds. Corporate bond and international/global funds accounted for the balance of sales. Tax-free and government funds suffered net redemptions for the year, FRC reported.

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