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Sometimes it pays to invest in familiar, locally-based companies.

It paid off in 2010 for Utah investors who kept their money close to home.

The Tribune/Bloomberg Index, which measures the share-price performance of the state's 25 leading publicly held companies, rose 16.9 percent last year. By comparison, the widely followed Dow Jones industrial average was up 11 percent. The Standard & Poor's 500 rose 13 percent.

It was a good year for small-cap companies, which make up the bulk of the Tribune/Bloomberg Index. Such corporations have a market capitalization — a figure calculated by multiplying the number of shares a company has outstanding by its stock price — of $1 billion or less.

"Small-cap stocks generally are the first to show improvement when the economy begins to grow," said Gary Teran, president and CEO of First Western Advisors in Salt Lake City. "And that was what we saw last year."

Teran noted most stock market gains occurred in the final four months of 2010, the result of a "confluence of events"ranging from an accommodative Federal Reserve to the stabilization of the nation's tax policy.

And that bodes well for the year ahead, Teran said, because of the prospect that interest rates will remain low as the Fed signals its willingness to buy $600 billion in long-term government bonds and increase the money supply.

Utah's best-performing stock in 2010 was that of BSD Medical Corp., which is hoping 2011 will be equally successful. The company that manufacturers and sells hyperthermia equipment used to treat cancerous tumors and other diseases saw its shares gain 177 percent for the year.

"We just successfully launched our microwave-ablation product after gaining FDA approval in August," said Dennis Gauger, BSD's chief financial officer. "And we now are now working to set up our distribution network worldwide."

He added the first patients were treated with the new system at St. Mark's and the Veterans Affairs hospitals in Salt Lake City.

FX Energy had Utah's second best-performing stock, with a gain of 116 percent.

The company, which claims extensive land holdings in Poland, last week reported that production from three recently completed natural gas wells is expected to boost its overall production by 60 percent.

Other Utah-based companies that saw significant increases in their share prices: Zions Bancorp, up 89 percent; Novell Inc., up 43 percent; and Huntsman Corp., the stock of which rose 38 percent in value.

Still, there were 12 Utah companies that saw their share prices decline.

The stock of Headwaters Inc., the South Jordan-based building products company, fell 30 percent because of continuing weakness in the nation's construction industry. Shares of EnergySolutions, the nuclear-waste storage company, fell 34 percent. The company in the third quarter reported it was terminating its 2.5 cents per share quarterly dividend.

Utah's worst-performing stock belonged to Raser Technologies. The company, which is involved in the development of geothermal power plants, saw its shares decline 87 percent. In November, Raser's shares were suspended from trading on the New York Stock Exchange and are listed on the Over-the-Counter Bulletin Board.