'P' in This PC=Profits

It has the look of a sector fund, the feel of a value fund... with the heart of a politically correct fund.

The Victory Lakefront Fund, open since March 3, champions racial diversity in corporate America and targets African Americans for investors.

Looking for value

But fund manager Nate Carter keeps the focus on performance and sees the fund as "a large-cap value fund" geared to solid returns over time.

Value funds look for financially secure companies that are undervalued. Mr. Carter's fund, invests in large-capitalization companies, with a minimum of $1 billion worth of stock in the market. So far, he holds 47 firms, including Ford, Kodak, and American Express.

"Anyone," Carter stresses, is welcome to buy the fund. And in two weeks, it has attracted about $1 million.

Ironically, Carter does not target companies based on their racial diversity.

He looks for profits.

The consciousness-raising comes after Carter buys a stock, when he hopes to help promote racial diversity within the company.

Carter, who is black, holds an MBA from Harvard.

Better returns

Is this a bad time for a new fund, with market valuations high? Carter remains essentially bullish and expects only a modest correction.

So called "socially responsible" funds differ from Carter's by targeting ideals instead of performance.

And it shows. As a group, they returned 1.61 percent through February, according to Morningstar.

Victory Lakefront is part of the Ohio-based Victory fund family, carries a 4.75 percent sales charge and estimates no annual management charge: 800-539-3863.