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MONEY SMALL INVESTOR INDEX: SMALL INVESTORS REACH FOR UTILITIES' 5% YIELDS

 /ADVANCE/ NEW YORK, May 16 /PRNewswire/ -- Over the past six weeks, yield-hungry investors have poured $1.4 billion into utility-stock mutual funds paying around 5 percent, according to data gathered for the Money Small Investor Index.
 The reason: The funds, which hold electric, gas and telephone shares, offer yields at least 1-1/2 times those of certificates of deposit and money-market funds, which now pay only about 3 percent. In addition, the average utility fund has appreciated 6.8 percent so far this year, giving the group the third best return among all domestic fund categories. (Only gold and real estate ranked higher.)
 As a result, the rush into utility funds, which has been strong all year, has accelerated recently. Over the past six weeks, cash inflows are up 35 percent over those of the previous six weeks, according to AMG Data Services of Arcata, Calif.
 For example, the $3 billion Franklin Utilities Fund, which yields 5.2 percent, has taken in a net $126 million in the past six weeks, compared with $115 million in the six earlier weeks. The $561 million Vanguard Utilities Income Portfolio, yielding 4.9 percent, has attracted $138 million since mid-March, vs. $80 million in the previous six weeks.
 While most analysts think utilities promise attractive returns over the long term, they worry that investors may be taking more risk than they realize. "This week's news of a pickup in inflation could cause interest rates to start rising," says Geraldine Weiss, editor of the newsletter Investment Quality Trends in La Jolla, Calif. "And if rates shoot up, utility stocks could fall as much as 15 percent before they recover."
 Last week, the Money Index fell $123 to $47,393. Stocks dropped $124, and bonds lost $24. CDs and money funds contributed $10, and gold gained $17.
 This Last Year % Change from a
 Week Week Ago Week Ago Year Ago
 102.49 102.76 94.69 -0.26% +8.24%
 Latest Changes for Each Asset
 % Change from a
 Category Index Week Ago Year Ago
 Stocks:
 NYSE 101.84 -0.79% +9.46%
 ASE/OTC 99.81 -0.65 +17.21
 Equity funds 102.75 -0.42 +9.60
 Bonds:
 Taxable bonds 105.20 -0.13 +11.95
 Municipals 105.42 -0.25 +11.97
 Bond funds 104.82 -0.31 +10.15
 Cash:
 CDs 101.31 +0.07 +3.82
 Money funds 100.92 +0.05 +2.77
 Other:
 Real estate 102.05 -0.21 -1.95
 Gold 141.12 +6.16 +26.78
 Jan. 1, 1993 equals 100
 Where Average Small Investors Have Their Money Now
 Current Year Ago Current Year Ago
 NYSE 23.36% 22.44% Bond funds 6.88% 5.78%
 ASE/OTC 7.38 7.08 CDs 13.41 16.49
 Equity funds 7.04 5.60 Money funds 23.78 23.83
 Taxable bonds 9.46 10.06 Real estate 0.82 0.78
 Municipals 7.27 7.41 Gold 0.61 0.53
 Sources: Bank Rate Monitor, the Federal Reserve, Investment Company Institute, Lehman Bros., Lipper Analytical Services, Merrill Lynch, Money Fund Report, Morgan Stanley Capital International, National Association of Real Estate Investment Trusts, Prudential Asset Management, Standard & Poor's, Robert Stanger & Co., World Gold Council.
 -0- 5/17/93
 /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/


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GK -- NY065 -- 8747 05/14/93 15:47 EDT
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