S&P begins a service to monitor portfolios

June 09, 1996|By NEW YORK TIMES

Standard & Poor's has started a portfolio monitoring service to inform fund sponsors, directors and others if a fund is being managed in line with its stated objectives and investment policies.

The company said it had already lined up Chase Vista funds and the Montgomery funds as clients. In quarterly reports, S&P will review securities holdings, credit risk, derivatives exposure and other key factors. It may also look at liquidity, bond maturities, portfolio concentration or regulatory limits.

Individual investors are well advised to do something similar, if on a smaller scale. They can look at the holdings listed in the fund's shareholder report to make sure they reflect the fund's objective.

When the performance of a fund is well ahead of its peers, they should examine why.

It may result from a heavy concentration in a certain market sector or derivatives or other risky investments.

Pub Date: 6/09/96

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