Consider putting money into Europe, bonds, Black & Decker

The Ticker

May 06, 1998|By Julius Westheimer

What should you do -- and not do -- with your money these days? Some suggestions: NEW ANGLE: European investments might now become more attractive because of the approaching currency union. The merging of currencies -- to be phased in starting in January 1999 -- encourages many overseas companies to restructure. Michael Metz, of CBC Oppenheimer Corp., says these closed-end foreign funds are appealing: France Growth Fund, Germany Fund, Italy Fund and Spain Fund, all traded on the New York Stock Exchange.

INFLATION LOSER: "It's a mistake to believe that bonds are conservative," says investment adviser Harold Evensky. "Bonds carry an enormous inflation risk; they will probably not keep up with annual consumer price increases. Even at 7 percent yield, you're barely edging ahead of inflation after taxes -- and that's at today's rate. If inflation rises, you'll quickly fall behind."

LOCAL LINE: Black & Decker Corp. and CEO Nolan D. Archibald are written up favorably in a two-page article in Business Week, May 11. The article says, "B&D is getting back in the groove, and Wall Street has noticed." The company's stock, now around $52 a share, sold as low as $34 in the past year.

HATS OFF! "When it comes to stock-picking, women outperform. Our portfolio -- a virtual mutual fund comprising companies in the "Working Woman 500" -- beat the Standard & Poor's 500 index by a wide margin over a recent 12-month period. Our portfolio was up 52 percent vs. the S&P 500 gain of 34 percent." (Working Woman, May.)

The biggest winners were Maxwell Shoe Co., up 116 percent; O'Reilly Automotive, Inc., ahead 81 percent; and Tootsie Roll Industries Inc., up 77 percent. The biggest loser: BeautiControl Cosmetics, Inc., down 52 percent.

ALL IN THE FAMILY: Don Phillips, president of Morningstar Inc., says, "Scores of excellent mutual fund companies now offer a broad range of funds. You can open one account with a 'fund family' that invests internationally as well as domestically, in big and small companies, in growth or value. All your paperwork arrives on a single statement in one envelope."

HONOR ROLL: Top-performing stock newsletters over a 10-year period, of 68 letters monitored, were, in order: OTC Insight, Prudent Speculator, MPT Review, Oberweis Report, Timer Digest, Wilshire 5000 Total Return and T-bill Portfolio Letter.

MAY FLOWERS: "The Dow Jones industrial average will rise 30 percent this year, reaching 10,300 by year-end, following a mild correction in midyear. Reasons: Lower inflation and lower interest rates." (Jeffrey Applegate, chief investment strategist, Lehman Bros.)

"The current lofty levels of stock prices just don't make sense." (Douglas Cliggott, J. P. Morgan & Co. chief strategist.)

Pub Date: 5/06/98

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