The fund world will soon exist with a little less vice. The oldest vice fund -- MorganFunShares -- is getting set to liquidate after the death of its founder and largest shareholder.

The Cleveland-based closed-end fund holds just $8 million in assets and will be liquidated before the end of the year. Directors for the fund said its small size make it too expensive to run.

The fund also lost its biggest proponent when Burton Morgan died in March. Morgan was in his eighties at the time of his demise. He had founded the fund during the market downturn in 1994 on the theory that people continue to purchase liquor and tobacco and even gamble during bad economic times. The fund's largest stakes were in International Game Tech and Anheuser-Busch.

The problem with the fund may not have been with its investment mandate, rather its structure may have been what held it back. The directors of the fund cited the closed-end structure as one of the (obvious) reasons why the fund could not attract more assets. However, Morgan himself had insisted upon the structure.

Morgan continued to own 48 percent of the fund's shares at the time of his death.

Meanwhile, the Vice Fund, a second offering in the niche sponsored by Mutuals.com remains open to investors. That fund has attracted $5 million in assets since opening in August 2002, according to Morningstar.  

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