NEW YORK (CNNfn) - Technology mutual funds are poised to kill a 16-year winning streak by ending 2000 in the red for the first time since 1984.
As the Nasdaq composite has struggled for most of the year, funds that invest in the sector are down an average of 24 percent as of Wednesday, according to fund-tracker Morningstar.
"It's the worst year in a big way," said Christine Benz, a Morningstar analyst.
Even in 1994, when many parts of the market suffered losses, technology funds squeezed out gains, Benz said.
Day after day, big tech names are delivering warnings. Most recently, Intel and Motorola have thrown cold water on the market.
The situation is so grim that there was speculation – apparently unfounded -- that one tech fund was going to liquidate.
Among the losers tracked by Morningstar are Amerindo Technology, down 55.92 percent; Firsthand Technology Innovators, off 33.27 percent; and Janus Global Technology, down 23.93 percent.
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The bottom of the performance chart also includes many Internet funds, such as Jacob Internet Fund, down 75 percent as of Wednesday, Benz said. Jacob Internet Fund is managed by Ryan Jacob, who led the Internet Fund to triple-digit gains in 1999.
Another trend this year is that funds that played it relatively safe have suffered more, such as the well-regarded T. Rowe Price Science & Technology Fund (PRSCX: Research, Estimates), Benz said. The fund, the managed by Chip Morris and the largest tech fund, is down 26 percent year to date.
Out of about 115 tech funds tracked by Morningstar, only seven are breaking even or making money this year.
The winners include PIMCO Global Innovation, up 56.60 percent; Icon Information Technology, up 16.66 percent, and Red Oak Technology Select, up 10.60 percent.
Other funds may not be in positive territory, but they are holding up better against their peers. For example, RCM Dresdner Global Technology is down 5.39 percent and Invesco Technology is off 1.37 percent, she said.
Benz said the numbers prove that investors would be better off keeping their money in diversified mutual funds. Many funds are already heavily into tech, and the average diversified fund has about 43 percent exposure in the sector.
"That's what we've been telling investors all along," Benz said.
She predicts that fund managers may move more of their portfolios into cash in anticipation of higher redemptions. But she hasn't seen investors pulling money out of the funds.
Whether or not the market has hit the bottom and is turning around is hard to tell. Benz pointed out that many analysts thought the tech drubbing in the spring was the bottom.
"We're still testing new lows," Benz said.
And some parts of the sector – like storage companies, are still trading at healthy levels, she said.
"A lot of the stocks still aren't cheap," she said. "Storage companies have held up pretty well." 
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