MONEY SMALL INVESTOR INDEX: SMALL INVESTORS BANK ON THE JANUARY EFFECT
/ADVANCE/NEW YORK, Jan. 9 /PRNewswire/ -- As the Dow Jones industrial average closed above 3800 for the first time ever last week, individual investors were pouring millions of dollars into aggressive growth-stock mutual funds, according to data gathered for Money magazine's Small Investor Index.
Investors began to step up their purchases of small-stock mutual funds in late 1993. AMG Data Services of Arcata, Calif., reports that shareholders added a net $1.8 billion to aggressive growth funds in the second half of December, vs. $602 million during the first half. The pace picked up in the first week of the new year, when net sales hit $1.2 billion. Denver-based Janus fund, with $9.2 billion in assets, took in $68 million in the first four days of January on top of $167 million in all of December.
Analysts say investors are showing faith in the January effect -- the pattern of small stocks rising in the first month of the year. And it may become a self-fulfilling prophecy, as funds use the new cash to buy small-company shares, pushing up their prices, says James Collins, the chief investment officer at Insight Capital Research in Walnut Creek, Calif. Looking ahead, Collins adds, "I think the NASDAQ Industrial Index will rise about 13 percent in 1994, vs. about 7 percent for the S&P 500," thanks to small companies' rapid earnings growth. Last week, the Money Small Investor Index, which tracks the typical individual's holdings, rose $13 to a record $45,396. Stocks gained $22, while bonds lost $32. CDs and money funds added $8, and gold rose $13. (With the new year, Money has revised the index, setting it back to 100 as of Jan. 1, 1994. Also, the size of the average individual's portfolio has been adjusted to reflect new figures from the Federal Reserve Board and Census Bureau.) This Last Year % Change from a Week Week Ago Week Ago Year ago 100.03 100.00 91.88 +0.03% +8.87% Latest Changes For Each Asset % change from a Category Index Week Ago Year Ago Stocks NYSE 99.74 -0.26% +11.51% ASE/OTC 101.21 +1.21 +15.07 Equity funds 100.19 +0.19 +14.99 Bonds Taxable Bonds 100.08 +0.08 +9.40 Municipals 98.59 -1.41 +11.14 Bond funds 100.06 +0.06 +10.06 Cash CDs 100.06 +0.06 +3.49 MONEY FUNDS 100.04 +0.04 +2.41 Other Real estate 100.20 +0.20 -1.49 Gold 104.09 +4.09 +86.19 Dec. 31, 1993 equals 100 Where Average Small Investors Have Their Money Now Current Year Ago Current Year Ago NYSE 26.26% 26.54% Bond funds 7.54% 6.41% ASE/OTC 8.29 8.38 CDs 13.33 14.96 Equity funds 8.49 6.40 Money funds 23.07 23.40 Taxable bonds 5.85 6.76 Real estate 0.84 0.76 Municipals 5.58 5.95 Gold 0.75 0.45 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- 1/10/94 /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:||Jan 7, 1994|
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