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MONEY SMALL INVESTOR INDEX: INVESTORS SCORE BIG GAINS IN BUSH YEARS

 MONEY SMALL INVESTOR INDEX: INVESTORS SCORE BIG GAINS IN BUSH YEARS
 /ADVANCE/ NEW YORK, Aug. 16 /PRNewswire/ -- Unemployment may be high and the recession may linger, but as Republicans convene in Houston this week they can claim at least one solid economic achievement for George Bush's Administration. Individual investors earned a better return under him than under any other President in the past 20 years, according to Money magazine's Small Investor Index.
 Since Bush took office on Jan. 20, 1989, the typical small investor's portfolio has grown at an average annual rate of 10.5 percent. That edges out the 10.3 percent that individuals earned during Ronald Reagan's second term and easily outpaces the 9.6 percent of Reagan's first term, the 8.8 percent under Jimmy Carter and the meager 4.5 percent in the Nixon and Ford years.
 Small investors achieved their returns during the Bush years despite the weakest economic growth since World War II. Reason: The sources of their biggest gains -- New York Stock Exchange issues, which rose at an annual rate of 16.1 percent, and taxable bonds, up 11.5 percent -- climbed chiefly on expectations of strong future growth in corporate profits and subdued inflation.
 For individuals to continue earning high returns, say most Wall Street analysts, the winner of the November elections will have to keep government spending under control and interest rates low. "If rates keep falling," says David Bostian, chief investment strategist at the Manhattan brokerage of Herzog Heine Geduld, "investors could earn 10 to 12 percent a year during a new Administration." But he warns that higher federal spending could force up inflation and thereby reduce annual returns to 6 or 7 percent.
 Last week, the Small Investor Index, which tracks the average individual's portfolio, fell $67 to $45,547. Stocks lost $96 while bonds gained $31. CDs and money funds contributed $11, and gold lost $13.
 This Last Year % Change from a
 Week Week Ago Week Ago Year ago
 103.94 104.09 95.94 -0.15% +8.34%
 Latest changes for each asset
 % Change from a
 Category Index Week Ago Year Ago
 Stocks:
 NYSE 105.13 -0.58% +10.58%
 ASE/OTC 102.09 -0.53 +10.73
 Equity funds 103.14 -0.80 +8.83
 Bonds
 Taxable Bonds 106.04 +0.41 +13.08
 Municipals 107.06 +0.03 +12.21
 Bond funds 106.08 +0.31 +12.62
 Cash:
 CDs 102.78 +0.07 +4.83
 MONEY FUNDS 102.23 +0.06 +3.99
 Other:
 Real estate 94.79 -0.05 -7.80
 Gold 89.48 -5.57 -13.86
 Dec. 27, 1991 equals 100
 Where average small investors have their money now
 Current Year Ago Current Year Ago
 NYSE 22.31% 21.86% Bond funds 5.95% 4.75%
 ASE/OTC 7.05 6.90 CDs 15.35 18.75
 Equity funds 5.56 4.55 Money funds 23.98 22.33
 Taxable bonds 11.57 12.26 Real estate 0.79 0.77
 Municipals 6.94 7.27 Gold 0.51 0.57
 Sources: Bank Rate Monitor, IBC/Donoghue's Money Fund Report, the Federal Reserve, Investment Company Institute, Lehman Bros., Lipper Analytical Services, Merrill Lynch, Morgan Stanley Capital International, National Association of Real Estate Investment Trusts, Prudential Asset Management, Standard & Poor's, Robert Stanger & Co., World Gold Council.
 -0- 8/17/92
 /NOTE TO EDITORS: This material is also available in printable form from AP GraphicsNet and Access services for graphics and tables (under the file name MoneyIndex) and from PR Newswire for full text./
 /CONTACT: Jordan Goodman of MONEY, 212-522-3618, or Patti Straus of MONEY public relations, 212-522-2695/


SH -- NY053 -- 0087 08/14/92 14:21 EDT
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