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MONEY SMALL INVESTOR INDEX: SMALL INVESTORS GAIN FROM FALLING DOLLAR

 MONEY SMALL INVESTOR INDEX: SMALL INVESTORS GAIN FROM FALLING DOLLAR
 /ADVANCE/ NEW YORK, Aug. 30 /PRNewswire/ -- The dollar's plunge to an all-time low against the German mark last week turned out to be a boon for U.S. individual investors, who have poured more than $2.7 billion into international bond mutual funds in the past few months, according to data gathered for Money magazine's Small Investor Index.
 Because global bond funds own investments denominated in foreign currency, the value of their holdings appreciates when the greenback sinks. As a result, the dollar's recent 13 percent slide has handed investors in long-term foreign bond funds capital gains of as much as 10 percent.
 The $693 million Scudder International Bond Fund, for example, has appreciated 10 percent in the past four months, in addition to paying an annualized yield of 8.4 percent. Investors have put more than $160 million dollars into the Scudder fund in the past two months. The $600 million T. Rowe Price International Bond Fund has also climbed 10 percent since April, on top of an 8.3 percent annualized yield, and has attracted $60 million since July.
 Currency experts predict that the dollar's weakness will persist as long as American interest rates remain 6 percentage points below German ones. Still, mutual fund experts caution that global bond funds are not without risk.
 "The dollar will not continue to fall forever," warns Robert Adler, president of AMG Data Services of Arcata, Calif., which tracks mutual fund money flows. "Investors should be aware that when the dollar rebounds, their shares could lose value."
 Last week, Money's Small Investor Index, which tracks the value of the average individual's portfolio, fell $205 to $45,360. Stocks lost $149, while bonds dropped $70. CDs and money funds contributed $11, and gold added $3.
 This Last Year % Change from a
 Week Week Ago Week Ago Year Ago
 103.51 103.98 96.21 -0.45% +7.02%
 Latest Changes for Each Asset
 % Change from a
 Category Index Week Ago Year Ago
 Stocks:
 NYSE 104.20 -1.08% +7.51%
 ASE/OTC 100.71 -0.81 +7.01
 Equity funds 102.60 -0.54 +6.48
 Bonds:
 Taxable bonds 106.11 -0.38 +12.47
 Municipals 104.87 -1.14 +9.59
 Bond funds 105.90 -0.50 +11.74
 Cash:
 CDs 102.93 +0.07 +4.75
 Money funds 102.35 +0.06 +3.91
 Other:
 Real estate 94.02 -0.25 -8.61
 Gold 91.36 +1.43 -6.59
 Dec. 27, 1991 equals 100
 Where Average Small Investors Have Their Money Now
 Current Year Ago Current Year Ago
 NYSE 22.17% 21.87% Bond funds 6.19% 4.75%
 ASE/OTC 7.00 6.91 CDs 15.15 18.70
 Equity funds 5.79 4.55 Money funds 24.01 22.37
 Taxable bonds 11.49 12.26 Real estate 0.78 0.77
 Municipals 6.89 7.28 Gold 0.52 0.54
 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- 8/31/92
 /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/ CO: ST: IN: SU: ECO


GK -- NY053 -- 4483 08/28/92 15:11 EDT
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Date:Aug 28, 1992
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