UPDATE

November 5, 2004

On finance and practice

FOCUS ON FINANCE

Are stock pickers worth anything?

Raymond James gave the best investment advice out of 10 firms from 1993 through 2002, but it still barely beat the S&P 500 Stock Index, says a study published in The Journal of Investing. The average quarterly return of the stocks recommended by Raymond James was 3.3 percent from Jan. 1, 1993 through the end of 2002, compared to a 2.3 percent return for the index. Overall, the recommendations of a total of 22 brokerage firms averaged 2.2 percent per quarter. The study covered all firms measured by Zacks Investment Research, which tracks brokerage recommendations. It also included company-specific statistics for 10 brokerages whose quarterly results were reported for the entire 10-year period.

Financial performance isn't enough A new fiduciary grading system is rating mutual funds on how well they look after investors' interests. Morningstar, the Chicago-based investment research company, is giving out letter grades from A to F based on the quality of corporate practices at mutual fund companies. Nine of the 10 biggest mutual funds received a B, including Fidelity Magellan and the Vanguard 500 Index. The third largest fund-Pimco Total Return-got a C from Morningstar.

The fiduciary grade covers performance on regulatory issues, board quality, manager incentives, fees, and corporate culture. But getting the information isn't free. The grades are available only with premium membership, which runs $12.95 a month.

Will your nest egg get fried?

If you're worried about global warming, check out a new Web site that spells out which mutual funds' returns are likely to be singed by climate changes. The site at http://www.cookingyournestegg.org covers the top holdings of the 24 largest mutual funds, examining how the companies are dealing with global warming issues-for better or worse. You can also read reports on the companies' energy policies and how they impact, and are affected by, climate changes.

Results for America, a nonprofit policy research group, runs the Web site using data from KLD Research & Analytics, a provider of social research to institutional investors.

The Motor City is no driving bargain Detroit is the most expensive city to own and operate a typical 2005 midsize car, clocking in at nearly $4,000 more a year than Sioux Falls, SD, says Runzheimer International, a business-consulting firm. Variations in insurance costs explained much of the geographic differences. Expenses include depreciation, fuel, maintenance, insurance, and license and registration fees.

Here are annual vehicle costs in a dozen cities: