Should you buy Raymond James\'s top picks? By Thomas M. Anderson, Contributing Editor July 31, 2006 Like state fair carnies who try to guess your weight, brokerage analysts often miss with their stock picks. One brokerage firm that shines in the murky swamp of stock research is Raymond James. We recently named the St. Petersburg, Fla., firm number two for research among outfits that cater to individual investors (see "Who Picks the Best Stocks," April). Now, a new fund puts James's picks to the test. The Claymore/ Raymond James SB-1 Equity fund, launched in May, invests in the stocks with James's highest rating. Named for the firm's "Strong Buy 1" rating, the fund (symbol RYJ) recently held more than 110 stocks, mostly of small and midsize companies. SB-1 is a closed-end fund. Closed-ends trade like stocks and can be worth more or less than the assets they hold, depending on investor demand. But SB-1 has a novel feature that protects investors from deep discounts. Unless most shareholders vote otherwise, SB-1 will convert to an open-end fund if the shares trade at 10% or more below the fund's net asset value (NAV) for 75 consecutive business days, starting in November 2007. Don't expect the conversion feature to kick in anytime soon. At $21 a share, the fund traded at a 16% premium to NAV in mid June. But if it sells at a discount, which it probably will in the future, call it a strong buy.