An award for smooth funds : YOUR MONEY

TO WIN a Micropal award is the ambition of every fund manager and life insurer in the UK. The awards are prized because Micropal uses a system to reward persistent good performance rather than just totting up individual fund performance.

Historically, fund performance has been measured by comparing total return over a given period, which is fine for rating individual funds and to show sector out-performance, but such an approach will not measure the overall relative investment merits of different companies.

Aggregating performances will simply benefit fund managers who happen to have had funds in sectors that were in favour at the time and those that, within their sector, took larger bets that happened to have paid off.

For its 1994 awards, Micropal used a "risk-adjusted" system that measures volatility. This is calculated by comparing the deviation between the monthly returns of the fund and the average return over a longer period.

William White, a publications consultant at Micropal, said: "Visually, a chart of a volatile fund will have a jagged appearance; one with low volatility will appear smoother. In our calculations, we regard the smoother fund more highly than the jagged one for a similar level of performance." He added that funds are marked equally on consistency and actual performance.

In the sector awards, funds are ranked according to their return, expressed as a percentage. Scores are averaged by group, making an adjustment for the size of the group. Micropal also makes a distinction between large and smaller companies in its awards. The smaller group awards are for companies with three to seven funds in three or more sectors over the given time period.

To arrive at the group awards, Micropal compares total returns for the longer-term period (more than a year), then compares the standard deviation of the monthly return over the period and divides one by the other; percentile scores of each fund (rank divided by the funds in a sector) are averaged for the group and adjusted for the number of funds the group has. The leading fund management group will be the one with the lowest score.

It also looks at performance before sales charges, judges unit and investment trusts and life funds on a basis of net income reinvested, and pension funds on gross income reinvested.

Best borrowing rates

MORTGAGES

Fixed rates Telephone Rate/period Max Fee Incentive

% advance % £

Hinkley & Rugby BS 01455 251234 1.50 to 1/1/96 70 £250 -

Capital Home Loans 01252 812271 2.99 for 1 year 95 £295 -

Citibank 0181 846 8363 6.45 to 1/3/97 85 £250 -

Iswich BS 01473 211021 8.25 to 1/1/99 95 - -

Northern Rock BS 0800 591500 8.74 to 15/4/00 90 £250 No MIG, free valuation

TSB Local branch 9.49 to 31/3/05 95 £250 Free valuation

Variable rates

Principality BS 0117 929 7804 2.00 to 31/5/96 75 - Free valuation

Bristol & West BS 0800 100117 2.49 for 1 year 90 - -

Greenwich BS 0181 858 8212 5.20 for 2 years 95 - £350 Cashback - FTB

5.90 for 3 years 95 - £350 Cashback - FTB

PERSONAL LOANS

Unsecured Telephone APR Fixed monthly payments on £3,000 for 3 years

% With insurance Without insurance

Midland Bank Local branch 15.40 £116.54 £103.14

Abbey National Local branch 15.90 £115.81 £103.77

Clydesdale Bank 0141 248 7070 16.20 £113.94 £103.33

Secured Max advance % Max term

Royal Bank of Scotland 0131 556 8555 10.90 70 3 years to retirement

Midland Bank Local branch 11.40 90 5 to 30 years

First Direct 0800 222000 12.30 80 Up to 40 years

TYPICAL OVERDRAFTS

Telephone Authorised Unauthorised

EAR % EAR %

Barclays Bank Local Branch 19.20 29.80

Lloyds Bank Local Branch 19.40 26.80

National Westminster Bank Local Branch 18. 90 33.25

BEST OVERDRAFTS

Telephone Authorised Unauthorised

EAR % EAR %

Woolwich BS 0800 400900 9.50 29.50

Alliance & Leicester BS 0500 959595 9.50 29.80

Abbey National 0800 555100 9.90 29.50

CREDIT CARDS

Telephone Card name Minimum Rate APR Annual

income pm % % fee

Standard

Robert Fleming (S&P) 0800 282101 Mastercard/Visa - 1.00 14.60 £12

Royal Bank of Scotland 0131 556 8555 Mastercard - 1.14 16.00 -

TSB Local branch Mastercard/Visa - 1.38 17.90 -

Gold cards

Lloyds Bank Local branch Mastercard £20,000 1.00 12.60 -

Midland Bank Local branch Mastercard/Visa £20,000 1.30 18.10 £35

MBNA International 0800 062620 Mastercard/Visa £20,000 1.38 18.90 -

STORE CARDS

Payment by direct debit Other methods

Telephone pm APR pm APR

John Lewis Local store - - 1.39 18.00

Marks and Spencer 01244 681681 1.70 22.40 1.84 24.40

Burtons Local store 1.94 25.90 2.20 30.40

APR=Annualised percentage rate. EAR=effective annual rate. All rates are subject to change without notice.

Source: London & Country. Freephone 0800 373300 Compiled on 23 February 1995

Best deposit rates

INSTANT ACCESS Telephone Account Notice Deposit Rate Interest

or term % interval

Skipton BS 01756 700511 3 High Street Instant £2,000 6.25 Year

Manchester BS 0161 834 9465 Easy Saver Instant £50 6.75 Year

Britannia BS 01538 392808 Capital Trust Postal £10,000 6.50 Year

£25,000 6.75 Year

NOTICE ACCOUNTS

Bradford & Bingley BS 0345 248248 Direct Notice 30 Day (P) £10,000 6.90 Year

Coventry BS 0345 665522 Postal 50 50 Day (P) £2,000 6.55 Year

Scarborough BS 0723 368155 Scarborough 50 50 Day (P) £25,000 7.35 Year

Bristol & West (Asset) BS 0800 303330 Asset 90 90 Day (P) £25,000 7.10 Year

TERM ACCOUNTS

Woolwich BS 0800 400900 One yr fxd rate bond 1 year £500 7.50 fixed Year

Halifax BS 01422 333333 Guaranteed Reserve 1 year £10,000 7.50 fixed Year

2 year £10,000 8.25 fixed Year

3 year £10,000 8.60 fixed Year

MONTHLY INTEREST

Birmingham Midshires BS 0902 710710 First Class Postal £1,000 4.79 Month

Britannia BS 01538 392808 Capital Trust Postal £2,000 5.84 Month

£10,000 6.31 Month

£25,000 6.55 Month

TESSAS (tax-exempt special savings accounts)

Manchester BS 0161 832 0101 5 Year £8,400 8.00 fixed Year

Market Harborough BS 0858 463244 5 Year £9,000 7.75 Year

Hinckley & Rugby BS 01455 251234 5 Year £3,000 7.65 Year

Barclays Bank 0800 400100 5 Year £1,000 7.50 Year

HIGH-INTEREST CHEQUE ACCOUNTS

Woolwich BS 0800 400900 Current Instant £500 3.85 Year

Halifax BS 01422 333333 Asset Reserve Instant £5,000 5.00 3 Months

Chelsea BS 0800 717515 Classic Postal Instant £2,500 6.00 Year

£25,000 6.50 Year

OFFSHORE (gross)

Portman Channel Islands 01481 822747 Instant Gold Instant £5,000 6.20 Year

Derbyshire IOM 01624 663432 Instant Access Instant £10,000 6.30 Year

Bradford & Bingley IOM 01624 661868 Island Ninety 90 Day £10,000 7.05 Year

Halifax JSY 01534 59840 Fixed Rate Intl 1 Year £50,000 7.70 fixed Year

NATIONAL SAVINGS

Accounts & bonds (gross) Notice or term Deposit Rate % Interest interval

INVESTMENT ACCOUNTS 1 Month £20 5.25 Year

£500 5.75 Year

£25,000 6.00 Year

INCOME BONDS 3 Month £2,000 6.50 Month

£25,000 6.75 Month

CAPITAL BONDS (Series I) 5 Year £100 7.75 fixed Maturity

FIRST OPTION BONDS 12 Month £1,000 6.40 fixed Year

£20,000 6.80 fixed Year

PENSIONER'S GUARANTEED INCOME BOND (Series 2)

5 Year £500 7.50% fixed Month

NS Certificates (tax free)

42nd ISSUE 5 Year £100 5.85 fixed Maturity

8th INDEX-LINKED 5 Year £100 3.00+RPI Maturity

CHILDRENS BOND (Issue G) 5 Year £25 7.85 fixed Maturity

P= by post only. All rates are shown gross and are subject to change without notice.

Source: Chase de Vere Investments PLC - 0171 404 5766. Compiled on 23 February 1995