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Tuesday, Sep 26, 2023

Your Personal Business

Costs of Trading ‘Spiders’ Can Creep Up on You

Dear George: I am investing in an S & P; 500 index fund. However, I recently heard about something called “Spiders.” Are they a better way to index?

, Harry, Escondido

Dear Harry: Spiders are an interesting variation on the concept of index investing. Instead of packaging an index in the form of an open-end mutual fund like the Vanguard S & P; 500 Index Fund, a Spider puts the investment into what is called an exchange-traded fund.

The term Spider refers to the actual name of the investment , Standard & Poor’s Depository Receipt (SPDR). It is a clone of the S & P; 500 index. However, unlike an open-ended fund, it trades like an individual security. Spiders trade on the American Stock Exchange, which means the shares can be bought and sold throughout the daily trading session. Traditional mutual funds can only be purchased at their net asset value, determined at the close of business each day.

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For all practical purposes the performance of an index fund and a Spider should be about the same. So, the thing to do is consider the costs associated with each investment.

Since Spiders are traded like a stock, it is necessary to pay a commission whenever you buy or sell. How much that commission will be depends on whether you invest through a full-service, discount, or online broker. Most traditional index mutual funds are no-load.

The next step is to compare the operating costs of the two investments. Both funds will have very low administrative costs because the portfolios are not managed. But, expenses can vary from one fund to another and it is important to compare those costs. Costs and expenses can affect long-term results.

If you happen to be a trader rather than an investor the Spiders might be an attractive alternative. However, for most people the open-ended funds might be the better way to go.

Dear George: I have received a packet of information from Sempra Energy regarding a buyback offer for the shares I own. Should I sell or keep my stock?

, Jayne, San Diego

Dear Jayne: Sempra Energy , parent company for San Diego Gas and Electric Co. , is conducting a Dutch Auction that allows shareholders to tender their stock for purchase by the company. The company plans to purchase up to 36 million shares, or about 15 percent of the company’s outstanding stock. By reducing the number of shares in public hands the company will save on dividend payments and raise the earnings per share.

Whether you submit all or a portion of the Sempra stock you own is totally your call. You have until Feb. 25 to tender your shares to the company. The offer allows you to submit your stock at any price between $17.25 and $20 a share. The company will use a formula to determine how many shares will be purchased and at what price.

Your decision to tender should be based on a number of considerations. The primary factor would be your attitude toward the investment. If you feel the stock has little potential for appreciation and you can identify a better place to put the money, then it may make sense to tender. Sempra has also announced a substantial reduction in the stock dividend. For some shareholders that may prove to be a disappointment.

Chamberlin is the host of “Money in the Morning,” heard weekdays from 9 a.m. to noon on Ksdo.com A/M 1130. Send your letters to him to P.O. Box 1969, Carlsbad, CA 92018, or E-mail him at (george@,moneyinthemorning.com).

-George Chamberlain

See Yourself Through a Hiring Manager’s Eyes

Dear Joyce: I have had a successful career as a broker on Wall Street for the past 14 years. I am looking to transition into information technology sales. How do I get past the interview without direct experience?

, K.L.

But you’ve had direct experience , plenty of it. You’re just selling another product. After an “immersion” crash course in IT (reading, studying, information interviewing), aim to step into the spirit of your new life right out of the box , without apology or feelings of inadequacy.

To remind yourself how to do a red-hot job interview, a good start is filtering your perspective through the eyes of a hiring manager. I asked Southern California star recruiter Lou Adler what you should be thinking about.

From “Hire With Your Head , A Rational Way to Make a Gut Decision” (Wiley), an excellent book Adler wrote as a powerful hiring guide for employers, he came up with a “Ten-Factor Candidate Assessment.” The assessment describes five levels that rank you on such factors as “experience, education and industry background.” The numerically valued levels range from, “Weak fit on all standard measures: not enough experience or education” to “Very strong comparable experience with good industry and educational fit.”

Your interview goal is to land on the upper tier of each factor by illustrating with true stories from your background how the selling of stocks and IT products requires similar traits and knowledge, such as analysis and problem solving.

Other factors in Adler’s candidate assessment chart: Comparability of past accomplishments, overall talent-technical competency-potential, management and organizational ability, energy-drive-initiative, trend of performance over time, problem solving and thinking skills, persuading-motivating others, character-values-commitment-goals, and personality-cultural fit.

Review the entire “Ten-Factor Candidate Assessment” chart online for free at Adler’s Web site (powerhiring.com) and see where you would likely land on an IT hiring manager’s scale , and what you need to do about it in planning your interviews.

Learn the lingo of the industry you’d like to enter. Read IT news and ads in this newspaper. Check IT Web sites, such as Brain Buzz (brainbuzz.com) or Techies.com. (techies.com).

Adler’s book and his helpful Web site offer tips in learning to think like one who may hire you. As an interview-closing technique, Adler recommends the employer say, “Although we’re seeing other strong candidates, you have a very fine background. What are your thoughts now about the job?”

I suggest you answer with a synopsis of your sales pitch about how you are right for the job, then toss the ball back by asking, “Are you making me an offer I can’t refuse?”

Job interviewing is an eternal skill set to master. Noted teacher and author Martin Kimeldorf of Tumwater, Wash., writes to remind us how much human history is changing and has changed over the past two millenniums.

As Kimeldorf says, “We moved from soil-bound villages to Internet communities, from hot and cold wars to a war against nature, from foot travel to space and underwater travel, from a society built around survival and many holy days to a society built around work and few vacations.

“And we moved from kings, queens, feudal lords and medieval religious kingdoms to nations, democracy, capitalism, socialism and back to ethnic cleansing, from cave paintings to neon modern art, from schemes for kingdoms in heaven to planning utopias and dreaming sci-fi fantasies.”

Kimeldorf philosophically speculates about what people will be toasting at the end of the third millennium. “But will there be people to toast , just a few crude inhabitants on a dust-swirling mote, third stone from the sun, getting ready for job interviews?”

Kennedy is a Cardiff-based syndicated writer and author of career guidance books. E-mail career questions for possible use in this column to her at (jlk@sunfeatures.com).

& #352;2000, Los Angeles Times Syndicate

Hiring Trends Now Favoring Those Seeking Jobs

Welcome to the new job market. Employers aren’t treating applicants or departing employees as they did in the 1990s. General hiring practices are changing. Interviewing is becoming more effective; benefits programs are improving; even part-timers are winning.

Don’t feel left out if you’re hovering around 40, 50 or even 60. One surprising but sensible change in the market is the attitude toward older workers. Although companies are aware of the legal ramifications of discrimination, they’re also extremely attuned to the fact that they have jobs to fill and not enough good people to fill them.

Several trends indicate employers are changing the attitude that they can replace employees easily. New hiring practices reflect the struggle of many companies to retain the people they bring on board.

Bill Ayers, president of the $20 million Ayers Group Career Partners International in New York City, with partnerships in 165 locations worldwide, provides human resource services for technical and nontechnical companies. He believes that interviews at both ends of the hiring process are becoming more careful. “There are fewer botched hires because more organizations are becoming aware of how critical are skills along with compatibility with their culture,” he states.

“Also, companies are using exit interviews with greater frequency as their value becomes clearer,” he points out. “These interviews help companies identify specific reasons for a person not to be there, such as working conditions or opportunities for education, advancement and personal development.”

Employers are also extending more counter-offers in exit interviews, in the form of higher salary, more education, responsibilities, alternative work arrangements, even a behavioral change that would enable a person to remain with the company.

“Overall, companies are opening up better lines of communication with employees,” he concludes.

Ayers adds rehiring former employees as employees or consultants is gaining popularity because of their perceived value in terms of their knowledge of the organization. Employees are also referring friends, for whom they can receive up to $5,000 as a flat fee or percentage of the applicant’s salary, but more likely from $1,000 to $2,500.

The fact that not all companies are using this policy may have to do with the experience of many compensation and benefits personnel, he thinks, who consider even a few hundred dollars a lot of money. He believes others involved in advertising, outsourcing and other activities pushing recruitment costs to $10,000 per person are more likely to see value in referral incentives.

The tight labor market also compels some companies to review and improve their benefits, according to a survey of 100 human resource professionals nationwide by Assurex International. Headquartered in Columbus, Ohio, the $1.3 billion company is a world leader among privately held commercial insurance brokerages.

Thomas Harvey, president and CEO, found 41 percent judged their companies’ benefits plans “very effective” in attracting and retaining qualified employees. In other words, while 2 percent gave no opinion, well over half , 57 percent , judged theirs somewhat or not very effective. These statistics reflect growing awareness of the market’s demand for improved benefits.

Headquartered in Lincolnshire, Ill., the global Hewitt Associates LLC, at $858 million the United States’ largest employee-benefits consulting organization, learned among 300 large companies nationwide, more than 69 percent offer a range of benefits for part-time workers (30 hours or more). Statistics reflect an upturn in this practice in the last four years, according to Carol Sladek, a work/life consultant.

– 78 percent, health and dental, up 5 percent since 1995

– 91 percent, paid time off, up 8 percent

– 47 percent, alternative work arrangements, up 22 percent

– 57 percent, short- and long-term disability coverage, up 10 percent for short-term coverage and 4 percent for long-term coverage

Finally, Ken Barksdale, president of Rewards Plus, a Web-based benefits firm, found that 25 percent of 98 benefits professionals surveyed will be giving part-time employees , those who work 20 to 32 hours per week , the same benefits as their full-time counterparts.

Clearly, trends in hiring and benefits make this a job-hunter’s market.

Culp sponsors the annual WorkWise Award. For more information, visit (www.work- wise.com).

& #352;2000 Universal Press Syndicate


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