Year’s Top Fund Being Closed to New Investors

Van Wagoner Capital Management said Friday it will close to new investors its Emerging Growth Fund--this year’s best-performing U.S. stock fund--because increased inflows could crimp returns.

The closely held San Francisco-based company said that on Monday it will shut the fund, which is up more than 200% this year, capping its size at about $1 billion in assets. The fund’s assets were $325 million at the beginning of the year.

Van Wagoner also will close its Micro-Cap Fund, up more than 150% this year, capping assets at about $250 million, leaving it with three funds that remain open.

“We think it’s in the shareholders’ best interest to cap assets now, before the fund gets too big,� said Peter Kris, managing director of Van Wagoner Capital Management. “We’re a small private organization and we want to make sure we can be as effective as possible.�

The surge by Van Wagoner’s funds represents a turnaround from last year’s slide and makes it likely this will be the first year since 1996 its flagship Emerging Growth Fund will top the benchmark Standard & Poor’s 500 index.