Subject: File No. S7-12-04
From: James E Grant, CPA

April 14, 2004

Dear Sir/Madam

I am author of How to Select and Use Mutual Funds published by CCH, Inc., and I frequently speak and write on mutual fund investing issues. I will be making comments about a number of SEC proposals to regulate the mutual fund industry.

As I frequently relay to those in attendance at my seminars, the most important variable in mutual fund selection is the track record of the manager and his or her tenure at the helm of the fund. Turnover, expenses, sales charges, and other variables are important but the ill effects of these influences can be overcome by exemplary management.

The Team Approach to mutual fund management, without disclosing the names of the team members, should lead investors to the conclusion that a particular mutual fund is a training ground and their investors are guinea pigs for those in the team. Most mutual fund investors, however, are not aware of this practice by mutual funds, and they should avoid the fund entirely.

Mutual fund prospectuses should disclose every name of every individual responsible for managing assets of the fund and when he or she assumed such responsibility. It should be made more obvious to investors who manage their investments and when those duties were assumed. This information should be disclosed in a simple table AT THE FRONT of the prospectus free of clutter about those persons backgrounds. Academic research has pointed out that an advisors credentials are mostly irrelevant to performance, so reserve the advertisements for sales literature.

Respectfully,

James E. Grant, CPA