If at first you don't succeed, go global.

AXA Barr Rosenberg's Market Neutral fund has sputtered since its 1997 launch, but now the company plans to start a global Multi-Strategy Market Neutral fund, according to paperwork the Orrinda, Calif., company has filed with the Securities and Exchange Commission.

But given the less-than-stellar performance of its original market-neutral fund, why roll out another?

In short, this one is different, the company says. Like the Market Neutral fund, the new offering will also try to beat three-month U.S. Treasury bills. But it also will focus on stocks traded in the U.S., Japan, and the U.K. And instead of focusing on small- and mid-cap value stocks exclusively, as the older fund does, the Multi-Strategy fund will hold a broader range of both growth and value stocks.

"Our first market neutral fund has a style bias toward small-caps and value. This fund will hold stocks of all types: growth, value, large and small to give it investment style neutrality," says Dick Saalfeld, the firm's president and chief executive.

Market-neutral funds are designed to produce a positive return without rising and falling with the stock or bond market. Market Neutral's goal is to beat three-month T-bills by holding stocks that appear undervalued with part of the portfolio and shorting stocks they think are expensive and poised to fall. (Shorting or short-selling is a way to profit from a falling stock by selling borrowed stock in hopes of buying it at a lower price later on.)

Investors had high hopes when Market Neutral launched because the firm has successfully run the strategy for institutional investors since 1989 -- some $1 billion of the firm's $8.5 billion total assets are in its institutional market neutral funds. But so far the fund has flopped. Over the past two years, the cheap and mostly small-cap stocks the fund typically buys have gotten cheaper and pricey stocks the fund shorts have gone higher. In 1998 and 1999 the fund fell 1.1% and 11.7%, respectively. Since Jan. 1 the fund is down 8.2%, lagging most of its market-neutral peers.

The new fund doesn't carry a sales charge or load, but it doesn't look cheap either. Most market-neutral funds' expense ratios are around 2%, but the global fund's annual expenses are estimated at 3% in the fund's preliminary prospectus.

The filing also includes plans for two other no-load funds: Enhanced 500 and International Equity.

Enhanced 500 blends active and passive management. The fund will invest in S&P 500 stocks, overweighting stocks the management team thinks will outperform the index while underweighting stocks they think will trail the benchmark. The fund had better outperform the index, given that it charges 1.15% annual expenses when investors could just about match the index for a .18% annual fee with Vanguard 500 Index.

International Equity will focus on foreign stocks the management team believes are undervalued. The fund will primarily hold stocks in the MSCI-EAFE Index, but can invest up to 40% of the fund in other stocks. The fund's 1.71% expenses are in-line with the category average, according to Morningstar.

Quant Funds Offers Paperless Investing

A fund company that relies on a computer for investment picks is among one of few that will let investors buy shares through their own computers.

Quant Funds, a Lincoln, Mass., company that bases its portfolio strategy on quantitative computer models, announced today that would-be shareholders can buy the fund directly online without having to send in a paper application. Invesco of Denver has offered a similar paperless application process since last fall.

Like Invesco, Quant will use Automated Clearing House to withdraw money from shareholders' accounts. Initially, the company will limit online investments to $10,000 for the first 90 days.. Within that time period, redeemed funds can only be deposited back into the accounts they came from.

Mutual fund companies have resisted online applications because they lack customers' signatures. If a fund company gets into a dispute with shareholders, there's no John Hancock backing the deal. "We believe there's enough case precedent in the software industry alone to support these contracts," says Quant Fund president Frederick Marius.

Invesco has gotten around the issue by changing prospectuses to tell investors that if there is a dispute, the fund company probably isn't at fault. Quant also amended prospectuses to spell out the contract laws binding the online signatures.

Whether the move will prompt other companies to get into the area is unlikely since Quant is a relatively small player with just $230 million under management. But Marius believes many directly sold mutual funds will make similar moves in the next six to 12 months.