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Telecom charges up a stodgy sector: utilities

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Quick. Name the two utilities featured in the Monopoly board game.

If you guessed Water Works and Electric Company, pass Go and collect $200.

Many players may opt to control the only two utilities in the game, but those holdings just don't carry the oomph of Park Place or Boardwalk.

Utilities are just ho-hum.

But that's not how Eaton Vance Utility Fund manager Judy Saryan sees it. In fact, when it comes to buying and selling utility stocks, Ms. Saryan adds spice by investing heavily in a utility that Parker Brothers forgot: telecommunications.

"When you look at the overall utilities industry, the growth is really coming out of telecom," Ms. Saryan says from her Boston office at Eaton Vance headquarters, "And that's why our fund has done well this year."

Her fund's 40 percent return over the past year puts it among the top five utility funds, according to rankings by Chicago-based fund-tracker Morningstar Inc. It also touts an 18 percent annualized return for the past five years.

And Saryan is confident of the fund's future success. She's "quite pleased" with how it is positioned following the announcement Oct. 5 by long-distance carrier MCI WorldCom Inc. to buy Sprint Corp. for $115 billion - the biggest merger in history.

While she reduced the fund's exposure to MCI Worldcom earlier this year, Sprint remains among its top holdings. Saryan also has big stakes in SBC Communications, Energis, GTE, and Bell Atlantic.

More recently, the fund's portfolio shifted more toward two areas more commonly associated with utility funds. "We're balancing that growth that we're getting in telecom with the stability that you get from the electric and natural-gas areas," she says.

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