Katherine Bonner, stock-market player, is not afraid of those brainy, brawny institutional investors who routinely turn Wall Street upside down with their 100,000-share transactions. Nor is she intimidated by those high-tech program traders who can send the Dow Jones averages reeling with their computer- powered stampedes. In fact, Bonner is not only making what she modestly calls a "good living" in the market but is earning enough to help out her grandchildren and great-grandchildren too. A highly active investor, Bonner, an 80-year-old Houstonian, has built up a handsome portfolio by studying financial news assiduously, visiting her discount broker every morning and afternoon to keep tabs on the market and making her picks ahead of the professional pack. "I am not all that smart, I've just got some common sense," says Bonner, a former artist and pharmacist. Institutional investors take note: right now Bonner likes oil and pharmaceutical stocks.
Bonner is among millions of individual Americans who are making a private killing in the wild bull market of the 1980s, which will turn five years old on Aug. 13. They have come back with growing confidence to the stock market they fled during the bearish 1970s. "The longer the bull market goes on, the more believers there are," says Charles Neuhaus, a broker for Houston's Underwood, Neuhaus. During the first half of this decade, the number of Americans who own shares in individual companies or stock-market mutual funds increased from 30.2 million to more than 47 million, according to a study by the New York Stock Exchange. While half those shareholders own stock in only one company or fund, the other 23 million or so include many investors who have turned stock picking into a serious pursuit.
/ These individuals are reaping lucrative profits during an era in which the big institutional players would seem to have all the advantages: research, resources and speed. While individuals control nearly two-thirds of all stocks, or about $2 trillion worth, institutional investors turn over the remaining third at such a rapid pace that they account for 80% of all stock transactions. Private investors are much more likely to sit tight with chosen stocks. But the more active individuals are finding their own tools and tricks. They now cut the cost of commissions by ordering through discount brokers, follow obscure companies through a growing number of newsletters, keep their holdings in convenient cash-management accounts and even get stock quotations through hand-held radio receivers.