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MONEY SMALL INVESTOR INDEX: INVESTORS CHOOSE 9.5% YIELDS OF FOREIGN BONDS

 MONEY SMALL INVESTOR INDEX: INVESTORS CHOOSE
 9.5% YIELDS OF FOREIGN BONDS
 /ADVANCE/NEW YORK, March 15 /PRNewswire/ -- With yields as high as 9.5 percent on some foreign government bonds, Americans who invest in overseas securities are choosing bonds over stocks, according to data gathered for MONEY magazine's Small Investor Index.
 Individuals added $788 million of new money to their holdings of global bond funds in January, compared with net investments of $560 million in foreign stock funds. And that pattern has continued over the past month and a half, according to major mutual fund companies.
 At Scudder Stevens, for instance, the Short Term Global Income Fund, with assets of $543 million and an average maturity of a little over a year, attracted nearly $100 million in the month of February and the first week of March. That's more than three times the $30 million invested in all four of the company's foreign equity funds over the same five-week period.
 Similarly, at Massachusetts Financial, the $289 million Worldwide Governments Trust Fund, with an average maturity of around eight years, took in five times as much new money as the company's $91 million Lifetime Global Equity Trust.
 Yet bond market experts warn that despite attractive yields, global bond funds may be risky right now. "Don't let the yield fool you," says Jay Goldinger, chief market strategist at Capital Insight in Los Angeles. "The dollar is only going to get stronger over the next six months, and investors could end up losing a lot of money." The reason: As the value of the dollar rises, payouts on foreign government bonds are worth less to U.S. investors.
 Last week, the Small Investor Index, which tracks the typical individual's holdings, fell $130 to $45,108. Stocks lost $107, while bonds dropped $32. Certificates of deposit and money funds contributed $14.
 This Week Year % Change from a
 week ago ago Week ago Year ago
 101.07 101.36 91.88 -0.29% +10.00%
 Latest Changes for Each Asset
 % change from a
 Category Index Week ago Year ago
 Stocks
 NYSE 100.39 -0.59% +11.57%
 ASE/OTC 110.12 -0.97 +31.67
 Equity funds 103.41 -0.92 +14.97
 Bonds
 Taxable bonds 98.64 -0.25 +10.34
 Municipals 100.10 -0.36 +8.76
 Bond funds 99.73 -0.24 +12.07
 Short-term assets
 CDs 100.93 +0.08 +5.66
 Cash 100.83 +0.07 +4.80
 Other
 Real estate 97.96 -0.26 -5.20
 Gold 95.95 -1.36 -5.44
 Dec. 27, 1991 equals 100
 Where Average Small Investors Have Their Money Now
 Current Year ago Current Year ago
 NYSE 21.29% 21.68% Bond funds 5.22% 4.17%
 ASE/OTC 6.72 6.85 CDs 16.75 19.68
 Equity funds 5.08 3.98 Cash 23.17 21.57
 Taxable bonds 12.95 13.17 Real estate 0.78 0.76
 Municipals 7.52 7.58 Gold 0.53 0.55
 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- 3/16/92
 /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/


CK -- NY055 -- 7930 03/13/92 16:13 EST
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Date:Mar 13, 1992
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