Wall Street Panicky, Main Street Steady - Eyes on Goals

'Duck and cover," the survival cry of the nuclear age, now beckons as the watchword for Main Street investors.

Owners of equity mutual funds increasingly worry that six years of stock market gains could vaporize in a mushroom cloud of selling.

So far, most are sitting tight - with an eye on long-term goals not market bumps. They seem willing to ride out the turbulence, say analysts and fund groups.

But not without fastening their seat belts.

Many investors are adjusting their portfolios, shifting from aggressive funds into steadier growth-and-income funds, which invest in stable, dividend-paying companies.

And new money is pouring into cash, not stocks.

"All of the incoming money is going into money market funds," says says Tracy Gordon, spokeswoman for Charles Schwab Corp. in San Francisco.

But "clearly individual investors are not panicked," says Ms. Gordon:

The Dow Jones industrial average is off 6.6 percent since March 10, but "by far the majority are sitting tight," she says.

The exit from equities, so far, looks limited. Conservatively managed Vanguard Group Inc. of Valley Forge, Pa. reports net inflows into all fund types, even during the recent whipsaw trading days.

"We're positive across the board," says spokesman Brian Mattes.

And with good reason. Small investors are not a panicky bunch.

Historically, mutual fund investors take downturns in stride. During each of the sharp declines since 1944, owners of stock funds did not cut and run en masse.

Even after the market crash on Oct. 19, 1987, investors staged a gradual withdrawal. By May 1988, only 11 percent of households in a survey had sold out of equity funds, according to the Investment Company Institute (ICI) in Washington.

Also, investors at the end of 1995 had put 35 percent of total mutual fund assets into retirement plans, a big jump from 25 percent in 1992. Some two-thirds of mutual fund investors now target retirement and college savings.

That long-term strategy suggests investors will stand fast, despite short-term losses, says John Collins of ICI.

They also stay cool, says Mr. Collins, because they stay informed. He points to "a noticeable increase every year in the amount of investment information available to the little guy."

"Mutual fund investors are becoming much more educated about the value of long-term investing," says Teri Kilduff of Fidelity Investments in Boston.

She says money market purchases at Fidelity rose in March. Equity funds charted slower growth, and conservative growth and income funds attracted most equity investment.

Still, mutual fund investors own just 15 percent of outstanding equities in the US, says ICI. Experts say that makes them vulnerable to market pressures generated by institutional investors.