90% of Stock Mutual Funds Suffer Losses in 2002, According to Weiss Ratings; Precious Metals and Real Estate-Related Funds Only Sectors to Register Positive Returns.

Business Editors

PALM BEACH GARDENS, Fla.--(BUSINESS WIRE)--Jan. 27, 2003

Despite a fourth-quarter upswing in the stock market, 90 percent of stock mutual funds reported negative returns in 2002, according to Weiss Ratings, Inc., the nation's leading independent provider of ratings and analyses of financial services companies, mutual funds, and stocks.

This marks the third consecutive year that investors have suffered declines in stock funds, averaging losses of 19.22 percent, 12.5 percent, and 4.45 percent in 2002, 2001, and 2000, respectively.

"After losing money for three consecutive years, it's no wonder that investors are starting to shun stock mutual funds," commented David Lackey, president of Weiss Ratings, Inc. "Even some of the best fund managers are taking it on the chin."

Technology funds registered the worst performance of the year for a third straight year, with 99.3 percent of the funds reporting negative returns, compared to 98.6 percent in 2001 and 99.4 percent in 2000. Although the sector improved during the fourth quarter of 2002, posting a 16.89 percent return, investors still lost a staggering 40.25 percent on technology funds last year, compared to losses of 35.6 percent and 29.0 percent in 2001 and 2000, respectively.

Of the 8,150 stock mutual funds reviewed by Weiss, those recording the largest losses for the year were:

                                                                4th
                                              Weiss     2002     Qtr
                                    Fund    Investment Annual   2002
Fund Name                          Sector     Rating   Return  Return
-------------------------------- ---------- ---------- ------- ------
ProFunds-Wireless UltraSector    Aggressive
 Svc.                             Growth       U       (80.51) 49.53

ProFunds-Semicond UltraSector    Aggressive
 Svc.                             Growth       U       (70.40) 16.32
                                 Aggressive
ProFunds-Ultra OTC Fund Svc.      Growth       E-      (69.66) 32.82
                                 Aggressive
Rydex Dynamic-Velocity 100 H      Growth       U       (68.47) 32.85

Van Wagoner Post-Venture Fund    Growth        E-      (67.33)  13.1
-------------------------------- ---------- ---------- ------- ------

Weiss Investment Ratings: A = Excellent; B = Good; C = Fair; D = Weak; E = Very Weak; U = Unrated

Meanwhile, precious metals and real estate-related funds were the only sectors to post positive returns in 2002. Funds investing in precious metals earned an average of 59.7 percent for the year, while real estate-related funds reported gains of 3.5 percent. The stock mutual funds recording the largest returns for the year were:

                                                                4th
                                              Weiss     2002     Qtr
                                     Fund   Investment Annual   2002
Fund Name                           Sector    Rating   Return  Return
---------------------------------  -------- ---------- ------- ------
                                   Precious
First Eagle SoGen Gold Fund         Metals      B      106.97  14.64
                                   Precious
Monterey OCM Gold Fund              Metals      B       93.25  14.27
                                   Precious
Van Eck Int'l Investors Gold A      Metals      B       90.49  15.11
                                   Precious
Gabelli Gold Fund                   Metals      B       87.20  16.40
                                   Precious
Tocqueville Gold Fund               Metals      B       82.88  14.13
---------------------------------  -------- ---------- ------- ------

Weiss Investment Ratings: A = Excellent; B = Good; C = Fair; D = Weak; E = Very Weak; U = Unrated

Bond Funds Continue to Post Gains in 2002

In contrast to stock funds, 94 percent of bond mutual funds delivered positive returns to investors in 2002, for an average gain on all bond funds of 6.36 percent. These results represent a modest improvement compared to 2001 when 95 percent of bond funds posted gains, earning an average return on all bond funds of 4.65 percent.

Of the 4,284 bond mutual funds studied by Weiss, those recording the largest returns in 2002 were:

                                                                4th
                                               Weiss     2002    Qtr
                                     Fund    Investment Annual  2002
Fund Name                           Sector     Rating   Return Return
---------------------------------- --------- ---------- ------ ------
American Century Tgt Mat.-2025     US
 Inv.                               Treasury     C      29.02   5.47

American Century Tgt Mat.-2020     US
 Inv.                               Treasury     C+     28.33   5.07

American Century Tgt Mat.-2015     US
 Inv.                               Treasury     C+     27.08   4.38
                                   Global

Delaware Pooled Tr-Intl Fixed Inc.  Income       D      26.66   7.58

Delaware Pooled Tr-Global Fixed    Global
 Inc.                               Income       C-     26.17   7.04
---------------------------------- --------- ---------- ------ ------

Weiss Investment Ratings: A = Excellent; B = Good; C = Fair; D = Weak; E = Very Weak; U = Unrated

"These results should serve as a stark reminder that mutual fund investing, despite the added diversification, does not protect investors from the ups and downs in the stock market," cautioned Mr. Lackey. "Investors would do well to continue to limit the amount of risk in their portfolios, especially until we see clear signs of an economic recovery."

In addition to rating the risk-adjusted performance of more than 11,000 equity and fixed income mutual funds, Weiss also issues investment ratings on more than 7,000 stocks and safety ratings on more than 15,000 financial institutions, including banks, insurers, and brokerage firms. Weiss Ratings is the only major rating agency that receives no compensation from the companies it rates.

Consumers can purchase a rating for as little as $7.95 through www.WeissRatings.com, or starting at $15 by calling 800-289-9222.