Companies find new products and services for younger buyers

Mutual fund customers, especially those seeking aggressive investments, are getting younger. As a result, fund operators are catering to more youthful clients with a variety of new services, including a way to get cash from a mutual fund by using automated teller machines.

Mutual funds have tended to appeal to older individuals seeking the relative safety of professional investment management. In fact, of the owners of equity, bond, and income mutual funds, more than half are 60 years old or older and 22.5 percent are 70 or over, according to a 1982 survey of shareholders by the Investment Company Institute, the mutual fund trade group.

But ''when you get to more aggressive types of funds, the new products, you see the age distribution skewing toward younger investors,'' says Joseph Sumanski, associate economist at the ICI. For example, among 30- to 39-year-old investors, more had their money in aggressive growth funds than in any other type of fund, according to ICI data.

In fact, when Fidelity Group surveyed its customers last month, it found that in one group of aggressive funds, ''almost half of the people were under 45,'' says Darla Mendales, manager of shareholder relations.

The fund, Fidelity's Select Portfolio, offers investors the chance to invest in stocks in one of six industries: energy, technology, health care, metals, financial services, and utilities. Executives had expected the fund to appeal to ''the sophisticated investor - generally middle-aged people with lots of experience'' with investments, Mrs. Mendales says.

The stock market's rebound is one reason younger people are buying mutual funds, experts say. The upsurge has caused mutual fund popularity to increase, and ''a significant portion of the increase in equity (fund) sales is the result of younger investors getting interested in the equity market,'' says Jeffrey Stiefler, vice-president for consumer marketing at IDS, a Minneapolis-based mutual fund company.

Younger mutual fund customers are not only aggressive, they are also hungry for services. ''They seem to be extremely interested in services that give them information fast or that are very convenient,'' says Mrs. Mendales at Fidelity.

To cater to this customer, Fidelity in late October will introduce a ''Freedom Express Card'' which will let customers with a money market fund draw cash from the account at any of 4,500 automated teller machines scattered throughout 47 states. ''We expect this to be really popular with young people,'' Mrs. Mendales says.

Other companies that run money funds are expected to follow suit. ''Fidelity is the first to use ATMs, but Dean Witter is planning to and . . . Merrill Lynch'' has similar plans, an ICI spokesman says. Neither Dean Witter nor Merrill Lynch returned the Monitor's calls on this subject.

An IDS official adds that his firm is ''looking at a whole variety of ways to increase the utility of the cash management account as a payment mechanism.''

Catering to a younger clientele has caused mutual fund companies to alter their operating methods, industry executives say.

For example, IDS has added younger salespeople to help it market to younger customers. ''Our sales force is generally in the 40s. We are recruiting people in the 30s with substantially higher levels of education,'' Mr. Stiefler says. The IDS goal is to have a sales force ''at the same relative stage (of life) and who have the same sorts of problems and opportunities.''

Meanwhile, Fidelity is looking for ways to rewrite its literature to make it more appealing to younger customers. The plan is to have '''less dry legal-type (language) and more historical examples, more performance statistics,'' Mrs. Mendales says.

Some of Fidelity's younger clients, which the firm defines as those in their 30s and early 40s, have been asking for extensive data on the past performance of various funds which can be entered into a home computer. Thus the customer could automatically track his investment's performance.

Customer surveys also show that younger clients are partial to highly detailed, computer-generated statements of account, Mrs. Mendales says.

Of course, not all younger customers want to do their own data processing or peruse complex printouts. ''For our customer the computer phenomenon is not terribly important,'' Mr. Stiefler says. ''They select IDS because they need personal advice.''

Many of the yonng customers in Fidelity's equity funds started in money market funds and then ''moved on,'' Mrs. Mendales says. In fact, only 35 percent of the customers with Fidelity's money funds are under age 35.

Young customers' use of money funds does not contradict evidence that they tend to be more aggressive than older investors. ''You have to consider money funds, not as an alternative to aggressive growth funds, but as an alternative to depository accounts (in banks). In that way they are aggressive,'' ICI economist Sumanski says.

While young investors seem more willing to take risks, they are not ignoring the traditional investment advice to diversify one's holdings to minimize the possibility of losses. ''A lot of them in addition to selecting a portfolio of mutual funds also own individual stocks. They are looking at lots of ways to diversify their portfolio,'' Mrs. Mendales says.