A report showing outsize portfolio gains for US senators is raising new questions about ethics and conflicts of interest for Capitol Hill power brokers.

The study found that during the boom years of 1993-98, a majority of US Senators were trading stocks - and beating the market by 12 percentage points a year on average. By comparison, corporate insiders beat the market by 5 percent, and typical households underperformed by 1.4 percent.

Financial experts interviewed for this story say the senators' collective achievement is a statistical stunner, too big to be a mere coincidence.

That doesn't mean lawmakers were consciously capitalizing on inside information, or that Martha Stewart-style prosecutions are around the corner. But the study is putting lawmaker finances in focus during an election year. And it is revealing a broader concern: Barricades against financial self-dealing in Congress are surprisingly thin.

Warding off conflicts of interest has long been a focus in the executiv branch.

But in America's premier lawmaking body, few members divest themselves of assets upon assuming public office or hold their investments in "blind trusts." Unlike other federal employees, members of Congress are not required to recuse themselves when they have a financial interest in an issue they are legislating. And their required financial disclosure statements - which were used as the basis of the new study - are hardly as transparent as the public might expect.

"The public perception is that when a member has a stock in an industry he or she is regulating, there is a potential conflict of interest," says Larry Noble, executive director of the Center for Responsive Politics in Washington, which was not involved in the research. "When you add to it the higher rate of return [in the new study], it raises the question of whether new rules are required to avoid the appearance that they have an advantage that the average investor does not have."

To at least one individual with close knowledge of both investing and lawmaking, the notion of the Senate as a hotbed of day-trading is implausible.

"I don't get a lot of senators tapping me on the shoulder and saying 'What's hot?' " says Sen. Jon Corzine (D) of New Jersey, former chairman of Goldman Sachs. "If they were so interested in personal economics, you would think I would. I don't find this group of senators even a tenth as interested in personal economics as in other walks of life I've been in."

The study, done by researchers from four universities, paints a few senators as heavy traders - but not the institution as a whole. During the 1990s years in question, 62 senators disclosed some 6,000 stock trades. Nearly half of those were reported by just four lawmakers: Claiborne Pell (D) of Rhode Island, John Warner (R) of Virginia, John Danforth (R) of Missouri, and Barbara Boxer (D) of California. The vast majority of purchase transactions are less than $15,000.

Both the big traders and the small ones, in the statistical analysis, shared similar patterns of success.

Who's trading?

But it's unclear whether the senators made trading decisions themselves. "If I'm on that list, all the credit goes to my wife. She does all the stock transactions," says Sen. Bob Graham (D) of Florida.

Of the four biggest traders, only Mr. Warner and Ms. Boxer remain in the Senate, and they did not return calls for this story. But neither Mr. Graham nor other senators who commented take even the hint of using public office for private gain lightly.

Ethics a resonant topic

Even in a town where a billion dollars changing hands in an election year barely raises a yawn from the public, the charge that lawmakers are profiting from a job in the public trust can sink a career.

In 1992, 77 House members were defeated or retired after being named for writing bad checks in a House banking scandal.

The political fallout, including new ethics charges and countercharges, was so intense that members on both sides of the aisle agreed to disable the House ethics process - a seven-year "truce" that persists to this day.

Ethics complaints are handled discreetly in the clubby atmosphere of the US Senate. The Senate Ethics Committee does not even publish allegations of wrongdoing it may be investigating. The code of ethics is fairly general, and a committee of peers interprets those rules.

But in today's highly partisan climate, personal portfolios are an increasingly large target, especially in the US Senate, where the net worth of senators has been rising rapidly. Senate majority leader Bill Frist drew criticism for his family's financial interests in private hospitals during last year's Medicare debate. Last month, Rep. Billy Tauzin withdrew from negotiations over a top lobby job for the pharmaceutical industry, because of the appearance of conflict of interest over his role in supporting industry interests in drafting the final Medicare bill.

"Public financial disclosure provides the mechanism for monitoring and deterring conflicts," according to the Senate Ethics Manual.

But although the Senate's financial disclosure rules have been upgraded over the years, records are difficult for researchers to access.

For the new study, researcher Alan Ziobrowski of Georgia State University says that without the help of former Sen. Max Cleland (D) of Georgia, he could not have afforded to pay for the data.

The documents are available to view in the public documents room of the Hart Senate Office Building or can be ordered at a cost of 20 cents a page. In addition, individuals who access these files find that their name, professional affiliation, and date of access become part of the permanent record of the file - so lawmakers can see who's interested in them. "It can be intimidating," Ziobrowski says.

Moreover, by law, the disclosures are removed from the public record after seven years.

"If public disclosure is the first line of defense, it has obviously failed," says Thomas Ferguson, a political scientist at the University of Massachusetts, Boston. "These files were public in name only. It's very hard to get this information. Note that it took the team that did this research eight years."

The data are incomplete: Dollar amounts are reported only in broad ranges: increments such as $50,00-100,000, or "over $50 million." The researchers were able to estimate performance by following stocks for a year before and after transactions.

"We have the date of the transaction, then watch the stock after that date in time. They had an uncanny ability to pick the right things on the right days," says Mr. Ziobrowski.

"The behavior of common stocks purchased and sold by senators indicates that senators trade with a substantial informational advantage," says Mr. Ziobrowski, a professor of finance at George State University.

He concedes that some senators may have "just been lucky" with their trades. The report will be published in the Journal of Financial and Quantitative Analysis in December. It finds no difference between the returns of Democrats and Republicans:

Not a random result

Financial analysts say it is highly unlikely that such returns could be random or simply the result of good financial advice. "Senators may be just smarter, but it seems really unrealistic," says Eugene Fama, a professor at the University of Chicago's center for research in security prices.

Even more than corporate insiders, senators may have a broad knowledge of when things are going to come to pass. "They know people who run the companies, who are more than happy to see them whenever they want," says Roger Ibbotson, chairman of Ibbotson Associates in Chicago and a professor at Yale School of Management. "No one refuses to take the call of a US senator.

He cautions that trades in the Ziobrowski study all occurred in the boom 1990s, and many were likely in high-flying dotcom stocks. It means that a similar pattern of unusually high returns might not have persisted.

Ziobrowski says he began this project nine years ago, after reading a report that 3 out of 4 members of Congress who traded stock had investments directly affected by their legislative activity.

Still, some senators go out of their way to avoid the appearance of a conflict of interest. Sen. Richard Lugar (R) of Indiana says he sold all individual stocks in 1967. Sen. Ben Nelson (D) of Nebraska says he invests mainly in government securities and CDs for the same reason.