David Fry, left, whose company Fry & Co. is the principal of the 21st Century Fund, and trader Johan Carlsson look over information on a computer. Fry is one of a growing number of companies using high-tech methods such as the Internet to track market information. Photo by Ken Sakamoto, Star-Bulletin

Since mid-January, Luxottica's stock has risen more than 24 percent, earning a hefty gain for Carlsson, a trader for the 21st Century Fund, a locally based investment fund that specializes in overseas stocks.

Welcome to the world of global trading, cyberspace style.

It used to be that trading of this kind could be done only by the big brokerage houses and mutual fund giants. But thanks to the latest advances in telecommunications, small, niche players like the 21 Century Fund are entering the picture.

Using little more than a PC and a modem, traders like Carlsson now can cruise the information superhighway for company news, stock prices and influential financial newsletters, said Dick Barber, a local telecommunications expert and executive director of the Pacific Telecommunications Council.

Trading on the Internet, which is still in its infancy, could have a major impact on the financial services industry, according to Barber. It could allow consumers to by-pass middle men such as the brokerage houses and allow small firms to trade globally without having to invest in costly computer hardware, he said.

The 21st Century Fund, for instance, tracks up to 30 overseas markets at one time this way. Many of its stock investments are in emerging markets of Asia, which are beginning to heat up again.

"This whole electronic evolution is what levels the playing field for guys like me against the big houses," said David Fry, whose company Fry & Co. is the principal of the fund.

Fry, a long-time investor in the Asia-Pacific markets, launched the 21st Century Fund in August 1995. The fund, which has over $600,000 under management, operates as an investment pool, which is similar to a private mutual fund for wealthy investors. But unlike mutual fund shares which can be traded daily, investors can only buy and sell these shares once a month.

Technological advances aside, small funds like the 21st Century still face considerable challenges. Unlike the big, mainland money managers, they don't have the huge budgets to send their analysts around the globe to meet with executives and examine manufacturing plants and offices.

Nor do they have a huge sales force to market their shares.

"It's like a small retailer going against WalMart," said David McClain, Henry Walker Professor of Business at the University of Hawaii.

But McClain said a local fund may have other advantages over the bigger East Coast money managers, especially when it comes to investing in Asia. For instance, thanks to its location, Hawaii has a wealth of information when it comes to companies that operate in the Pacific Rim, he said. In addition to the University of Hawaii and the East-West Center, there are many Asian executives who travel and do business here.

Time may be another plus. According to Fry, the isles' geographic location and its time advantages are ideal for traders, allowing them to monitor activity in portions of each trading day, he said.

A locally based fund manager can track much of the trading in the U.S. and South American markets between 6 a.m. and 10 a.m. and can cover the Asia and Australia from mid-day to about 8 p.m. Europe's markets open at 10 p.m. and close about 4 a.m., Fry said. "We want want to be an investor in any place where there's an opportunity and that may take us to some pretty bizarre places."

So far, the 21st Century Fund's performance has been mixed.

Since January, the fund's net asset value is up about 7 percent, due partly to profitable positions in the Italian and Japanese stock markets, Carlsson said.

But going back to August, the fund is down about 4 percent, due largely to the two-year slump in the emerging market stocks, Fry said.