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MONEY SMALL INVESTOR INDEX: SMALL INVESTORS TAKE REAL ESTATE PROFITS

 /ADVANCE/ NEW YORK, June 20 /PRNewswire/ -- After helping to drive up the price of real estate stocks by almost 20 percent in the first three months of 1993, individual investors are cashing in their profits, according to data gathered for Money magazine's Small Investor Index.
 Since the end of March, reports AMG Data Services of Arcata, Calif., individual investors have yanked nearly $60 million out of mutual funds that invest in real estate investment trusts (or REITs), which are stocks representing pools of property or mortgage holdings. That compares with $353 million that individuals put into real estate funds during the first quarter of the year, when the investments soared 19.1 percent. Since then, real estate mutual funds have lost 2.9 percent.
 Experts say that fear of a potential inflation surge lay behind many investors' disenchantment with REITs. Inflation tends to push interest rates up, and higher interest rates, in turn, reduce the price investors are willing to pay for a REIT's dividends. The value of the average REIT fell 5.6 percent in April and May, according to the National Association of Real Estate Investment Trusts.
 But analysts say that investors' inflation worries -- and the sell-off in REITs -- may have been premature. Last Tuesday, federal government figures showed that consumer prices rose a negligible 0.1 percent in May. "The outlook for inflation is static at the worst," says Allen Parker, manager of the $20 million United Services Real Estate Fund. "As a result, REITs should be able to outperform the market at least until the end of the year."
 Last week, the Money Small Investor Index, which tracks the typical individual's holdings, rose $200 to $47,946. Stocks gained $138, while bonds returned $48. CDs and money-market funds contributed $10.
 This Last Year % Change from a
 Week Week Ago Week Ago Year Ago
 103.68 103.25 94.01 +0.42% +10.29%
 Latest Changes for Each Asset
 % Change from a
 Category Index Week Ago Year Ago
 Stocks:
 NYSE 104.33 +0.73% +15.18%
 ASE/OTC 102.81 +1.15 +26.73
 Equity funds 104.25 +0.50 +15.13
 Bonds:
 Taxable bonds 105.85 +0.58 +11.18
 Municipals 105.68 +0.19 +11.30
 Bond funds 105.85 +0.48 +10.05
 Cash:
 CDs 101.65 +0.07 +3.73
 Money funds 101.16 +0.05 +2.69
 Other:
 Real estate 101.67 +0.30 -1.05
 Gold 143.42 +1.31 +26.19
 Jan. 1, 1993 equals 100
 Where Average Small Investors Have Their Money Now
 Current Year Ago Current Year Ago
 NYSE 23.20% 22.43% Bond funds 6.99% 5.99%
 ASE/OTC 7.33 7.08 CDs 13.20 16.27
 Equity funds 7.07 5.57 Money funds 24.14 23.87
 Taxable bonds 9.40 10.05 Real estate 0.81 0.78
 Municipals 7.22 7.41 Gold 0.63 0.54
 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- 6/21/93
 /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 -- NY051 -- 3616 06/18/93 14:03 EDT
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Date:Jun 18, 1993
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