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MONEY SMALL INVESTOR INDEX: SMALL INVESTORS WARY AS DOW HITS RECORD HIGH

 /ADVANCE/ NEW YORK, Oct. 31 /PRNewswire/ -- Even as the Dow Jones industrial average closed at a record high of just under 3700 last week, individual investors were cooling off on stocks, according to data gathered for Money magazine's Small Investor Index.
 Several brokerage firms report that their small-investor clients are cutting back on equity purchases. At Merrill Lynch, for example, individuals bought only 11 percent more shares than they sold in late October. As recently as July, purchases by small investors exceeded sales by 30 percent. Customers of Charles Schwab actually sold about $100 million more in stocks than they bought during October.
 The small investors still buying stocks seem to be interested mainly in small companies that trade on the NASDAQ over-the-counter market and in mutual funds that hold such stocks. For example, $968 million MFS Emerging Growth, a small-stock fund, took in $16.8 million in October, about 16 times as much as $1.7 billion Massachusetts Investors Trust, a sister fund that specializes in more established companies. Market analysts say that cash from individuals, buying directly or through mutual funds, helped drive the NASDAQ index to six new highs during October.
 Many stock market pros think small-company shares will continue to outperform blue chips for the next six months. "Small companies' earnings are growing faster, and they will continue to be gobbled up by larger companies," explains Louis Ehrenkrantz, president of the brokerage firm of Ehrenkrantz King Nussbaum in New York City.
 Last week, the Money Small Investor Index, which tracks the typical individual's holdings, rose $54 to $50,539. Stocks gained $94, while bonds lost $51. CDs and money funds added $9.
 This Last Year % Change from a
 Week Week Ago Week Ago Year ago
 107.76 107.64 97.10 +0.11% +10.97%
 Latest Changes for Each Asset
 % change from a
 Category Index Week Ago Year Ago
 Stocks
 NYSE 109.79 +0.54% +14.32%
 ASE/OTC 114.26 +0.29 +27.68
 Equity funds 112.21 +0.32 +17.86
 Bonds
 Taxable Bonds 109.46 -0.16 +10.65
 Municipals 110.21 -1.30 +15.59
 Bond funds 109.87 -0.19 +11.38
 Cash
 CDs 102.87 +0.06 +3.51
 MONEY FUNDS 102.03 +0.04 +2.49
 Other
 Real estate 101.96 +0.13 +2.32
 Gold 160.11 +0.19 +54.32
 Jan. 1, 1993 equals 100
 Where Average Small Investors Have Their Money Now
 Current Year Ago Current Year Ago
 NYSE 25.36% 26.41% Bond funds 7.61% 6.17%
 ASE/OTC 8.01 8.34 CDs 13.77 15.62
 Equity funds 8.31 5.73 Money funds 23.45 23.49
 Taxable bonds 5.97 6.83 Real estate 0.90 0.76
 Municipals 5.94 6.18 Gold 0.69 0.47
 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- 11/1/93
 /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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Date:Oct 29, 1993
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