A brief history of the respectable mutual fund firm of Dodge & Cox -- my investment in Dodge & Cox International has earned me more than $10,000 in the last six months. I love their long-term, fundamental research and its commitment to investors' interest.

Dodge's managers reached the unanimous decision in less than two hours. In January 2004, the firm closed the then-$30 billion flagship fund to new customers, while keeping it open to existing investors. Eight months later, it closed a sister fund, Dodge & Cox Balanced Fund, which invests in stocks and bonds.

The low-profile firm was on the cutting edge of a trend in the mutual-fund world: the proliferation of megafunds, portfolios swollen almost beyond recognition as investors chase their winning results. Even as Americans come under criticism for not saving enough, there is an embarrassment of riches at the hottest-performing mutual funds. Research firm Morningstar Inc. lists nearly 60 mutual funds with assets topping $10 billion, up from 47 in 2001. Of these, about 10 are closed to new accounts, including Fidelity Contrafund, Vanguard Primecap Fund and T. Rowe Price Mid-Cap Growth Fund.

This unprecedented cash surge creates a dilemma. Fund firms struggle between their vested interest in raking in new dollars and management fees, and their obligation to maintain strong returns for existing investors. Smaller funds require fewer winning stock picks to beat their bogeys, while swollen ones can mean positions so big in some stocks that it becomes hard to buy or sell without moving the price. At $56.5 billion, Dodge & Cox Stock Fund is 10 times its size in 2000, as it began the run of outperformance that attracted so much of the new investment. It is the nation's 10th-largest mutual fund. The balanced fund is $24.6 billion, about five times its 2000 size.