Q-My 1,000 shares of John Hancock National Aviation & Technology are being merged into John Hancock Global Technology Fund at the beginning of August. What’s your opinion of this fund?
A-What’s really at issue is whether you think it’s a good idea to have a substantial amount of money in volatile technology-related stocks at this time. Many investors have been scaling back such holdings.
Your fund already had a technology focus, though its fortunes were primarily tied to the airline and aerospace industries. The biggest holdings were UAL Corp., Thermo Electron, AMR Inc., Raytheon and United Technologies.
Meanwhile, the $65 million John Hancock Global Technology Fund, Class A, had a dramatic 12-month return of 64 percent, placing in the upper half of technology funds. Its three-year average annual return was 33 percent, ranking in the upper one-fourth of tech funds.
After the merger, the resulting portfolio is expected to incorporate the aviation portfolio, which has been rebounding lately, with existing technology holdings.
“If you’re still looking for a straight play on aviation, this won’t be the fund for you,” said Alice Lowenstein, analyst with the Morningstar Mutual Funds investment survey. “However, with slightly more concentration in direct technology, there will still be the same management, discipline, low turnover and kinds of companies.”
Q-Each day I follow various popular stocks and recently got into a discussion about which companies have the most shareholders. I assume AT&T Corp. is still number one. What are the rest?
A-Telephone companies still ring up the most shareholders by far.
AT&T leads with 2.3 million common shareholders, followed by BellSouth Corp. with about 1.2 million. Rounding out the top eight are Bell Atlantic Corp., NYNEX Corp., SBC Communications Inc., Ameritech Corp., U.S. West Inc. and Pacific Telesis Group.
Next in line in popularity is General Motors Corp. with 782,000 common shareholders, followed by AirTouch Communications Inc., IBM Corp., Exxon Corp., Equitable Cos. Inc., GTE Corp., McDonald’s Corp., General Electric Co. and Walt Disney Co. This data from company annual reports was compiled by Standard & Poor’s Compustat.
Q-I’m trying to repair my credit so I can buy a home. I understand that a secured credit card is an excellent tool for this. Which are best?
A-Secured credit cards make sense for anyone trying to repair credit.
The card issuer requires that you make a deposit in a special savings account or special certificate of deposit to collateralize the credit line. As a result of this safety net, issuers approve the majority of applicants.
Secured credit cards do, however, generally charge higher interest rates and higher annual fees than unsecured cards. Sometimes there’s a special one-time application or processing fee. The amount of credit granted varies from issuer to issuer.
Some of the better secured credit cards available nationally, according to the RAM Research Corp. credit card research firm in Frederick, Md., include:
Best Bank, Thornton, Colo., 303-450-9074, $1,000 deposit for 9.9 percent card; Chase Manhattan Bank, New York, 800-48-CHASE, $300 for 17.9 percent card; Citicorp, Sioux City, S.D., 800-676-5520, $300 for 18.4 percent card; Federal Savings Bank, Little Rock, Ark., 800-290-9060, $250 for 9.72 percent card; and Key Federal Savings Bank, Rehoboth, Del., 410-939-0400, $300 for 18.9 percent card.
Q-A co-worker suggested I invest in zero coupon bonds. Can you explain these?
A-A zero coupon bond pays no current interest, but is sold at a deep discount from its face value. At maturity, all compounded interest is paid and the bondholder collects the full face value of the bond.
They particularly make sense for retirement or education investing, since you know exactly how much they’ll be worth at a specified future date. Sold through brokerage firms, zeroes are available in taxable and tax-exempt varieties. There are zero coupon bond mutual funds, as well.
———-
Andrew Leckey, who co-anchors the “Today’s Business” program on the CNBC cable television network each weekday from 5 to 7 a.m., answers questions only through the column. Address inquiries to Andrew Leckey, “Successful Investing,” Suite 332, 2124 Broadway, New York, N.Y. 10023.
