Wiser Trader Stocks and Options Newsletter

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Issue No. 69   March 13, 2006 Prescott, Arizona Systems@WiserTrader.com

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1.0 Trading

      The market is beginning to show weakness as measured by relative gains in major indices.

1.1 Outlook

      Market outlook can be judged by comparing the difference between percentage gains of major averages, as illustrated in Figure 1.  The NASDAQ (N) is a proxy for entrepreneurship and speculation.  The DOW (D) represents blue chips favored by institutional investors, the S&P 500 (S) represents large caps favored by conservative investors and the Russell 2000 (R) represents small caps favored by the retail investor.  The balance between speculator and conservative investor strength, measured by the ratio of NASDAQ gains to S&P 500 gains, has been declining.  This includes last Friday’s up tick on weak volume.  This gauge tells us that investors see tough times ahead.  Another gauge of market outlook is that institutional investors continue to run up blue chips in the DOW 30 causing the ratio of S&P 500 gains to DOW gains to decline.  Finally, the Russell 2000 has been weaker relative to the DOW over the past five or six trading days. 

FIGURE 1

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      The NASDAQ has remained directionless since mid January, as shown in Figure 2.  The trend lines are based on a two-year chart.  We have gotten used to seeing it move up one day and down the next or up two days and down the next two or something like that.  Until very recently, we have not seen sustained movement in either direction.  Over the past 10 trading days, the NASDAQ moved in the same direction four or five days out of six.  Unfortunately, the direction was down on strong volume.  Although it remains within its short term trading range, its 200-day simple moving average (SMA) is approaching from below.

FIGURE 2

2.0 Market Analysis

      Although a strong focus remains on bond yields, the stock market is choosing to ignore it; I believe only to react eventually as if rising yields were new information.  As we enter warnings season with high oil prices, the markets can be expected to remain choppy and mixed.

      Key industry ETF’s in Table 2A are Biotech and Semiconductors, which confirm the NASDAQ.  Transportation confirms the Dow Jones Industrial Average according to Dow Theory.  Banking and Financials are confirming indicators for the S&P 500.  Gold and Housing are respective indicators for the inverse health of the currency (inflation) and the capacity for consumer spending. 

Table 2A

Indices, Key Industry ETF’s and Sector SPDR’s

	1 month	1 wk ago	2 wks ago	3 wks ago	4 wks ago
Dow Jones Industrial Index	1.4%	0.5%	-0.4%	-0.5%	1.8%
NASDAQ Composite Index	-0.02%	-1.8%	0.7%	0.2%	0.9%
NYSE Composite Index	1.2%	-0.4%	-0.2%	0.2%	1.6%
S & P 500 Index	1.2%	-0.5%	-0.1%	0.4%	1.4%
Russell 2000 Index	1.3%	-1.6%	0.2%	0.8%	1.9%
HGX, Phil. Housing Index	-1.5%	-2.2%	-3.1%	2.4%	1.6%
IYR, Real Estate	6.0%	2.7%	-0.6%	0.6%	3.3%
GLD, GOLD	-1.8%	-4.4%	1.2%	1.2%	0.3%
RKH, Banking	2.6%	0.2%	-1.9%	2.0%	2.3%
IYT, Transportation	3.4%	-1.1%	1.5%	0.9%	2.1%
SMH, Semiconductors	-5.7%	-5.3%	2.7%	-2.5%	-0.6%
BBH, Biotechnology	0.6%	0.5%	-1.4%	0.9%	2.7%
OIH, Oil	-5.9%	-6.1%	2.2%	2.5%	-4.4%
XLE, Energy	-2.2%	-5.1%	0.9%	1.2%	0.9%
XLU, Utilities	-0.2%	-1.8%	-0.7%	0.7%	1.6%
XLB, Materials	1.3%	-1.4%	0.1%	0.2%	2.4%
XLI, Industrial	3.1%	0.3%	0.2%	0.4%	2.1%
XLK, Technology	0.4%	-1.3%	1.4%	-1.0%	1.3%
XLV, Healthcare	1.2%	0.2%	-1.0%	0.0%	2.0%
XLF, Financials	2.3%	0.4%	-1.1%	1.4%	1.6%
XLP, Consumer Staples	4.0%	2.5%	-0.5%	0.2%	1.8%
XLY, Consumer Discretionary	0.3%	-0.4%	0.1%	-0.5%	1.1%

Volatility

Indicator	Current	Last Week	2 Weeks Ago	Complacent	Cautious
VIX *	11.9	12.0	11.5	< 20	> 50
VXN **	17.6	16.3	15.2	< 30	> 70
*   Below 20 day SMA = Short-term buy signal. ** Above 20 day SMA = Short-term sell signal.

      Figure 3 compares the major averages with key ETF’s and Sector SPDR’s.

FIGURE 3

Table 2C

Market Summary

 Major Indices 
 For the Past Week:
 Dow Jones     +0.5%
 NASDAQ        -1.8%
 S&P500 Index  -0.4%
 Russell 2000  -1.6%
 NYSE          -0.5%
 
 30 Year Bond 4.742%
 10 Year Note 4.755%
 
 Leading Industries
 For the Past Week:
 Forestry 
 Forestry & Paper 
 Paper 
 Brewers 
 Nondurable Household Products 
 Automobiles 
 Mobile Telecommunications 
 Automobiles & Parts 
 Real Estate Investment Trusts 
 Full Line Insurance                  
 
 Lagging Industries
 For the Past Week:
 Platinum & Precious Metals 
 Gold Mining 
 Mining 
 Coal 
 Internet 
 General Mining 
 Water 
 Exploration & Production 
 Oil Equipment & Services 
 Oil Equipment, Services & Dis         
 
 Leading Industries
 For the Past Month:
 Consumer Electronics 
 Recreational Products 
 Mobile Telecommunications 
 Distillers & Vintners 
 Steel 
 Delivery Services 
 Defense 
 Telecommunications 
 Real Estate Investment Trusts 
 Industrial Machinery      
 
 Lagging Industries
 For the Past Month:
 General Mining 
 Gold Mining 
 Nonferrous Metals 
 Tires 
 Mining 
 Internet 
 Oil Equipment & Services 
 Oil Equipment, Services & Dis 
 Exploration & Production 
 Aluminum                      
 
 Crude Oil $59.95
 
 Gold for the past 30 days:
 USD    -1.87%
 CAD    -1.36%
 CHF    -0.80%
 GBP    -0.62%
 EUR    -1.67%
 JPY    -0.70%

3.0 Procedure

      The following watch lists contain stock candidates for consideration.  They are not necessarily trades.  Categories include checklists for insider buying and cash rich companies, as well as, filters that employ stock picking methods used by master traders. 

      Current stock rankings are based on the degree to which stocks are overbought or over sold based on the 28-period Williams %R for the past two trading days.  Two columns are labeled “%R1” and “%R2” with “%R2” indicating the Williams %R for the most recent trading day.  Of course, values more negative than -80 are oversold and those less negative than -20 are overbought.

      One should keep in mind that oversold stocks are not necessarily ready to move upward.  They could very well be in a condition of continuous decline.  The lists are meant to serve as a starting point for further due diligence. 

      A column labeled “Monthly % Gain” was added to show the inverse relationship between price action over the past month and the Williams %R.  The change from a 10-period Williams %R with a weekly percent change to a 28-period Williams %R with a monthly percent change was done to reflect a longer term view.

      The “Reference” is the date that a stock passed the indicated filter and was first added to or returned to the list.  The “% Change” is how the price has changed since the reference date.  Stocks that are down 10% or more after being listed are removed for a period of about two months.  The “% from Max” is the percentage the price has declined from the maximum price reached since the reference date.  Stocks that are down 8% from their highs after being listed are flagged in yellow.  Stocks that are down 15% from their highs after being listed are removed for two months.  More information on filters is available on the web site.

      A performance summary of filtering techniques for checklists and master trader selection methods is given in Table 3A. 

Table 3A

Stock Filter Summary

Filter	Avg. % Change Since Listed	Avg. % Change Friday	1 Month	1 Week Ago	2 weeks Ago	3 Weeks Ago	4 Weeks Ago
Net Insider Buying	5.7%	1.5%	2.5%	-1.6%	2.0%	0.2%	1.6%
Cash Rich Companies	0.1%	1.0%	-7.3%	-2.0%	-2.0%	-0.5%	-2.9%
Price to Free Cash Flow	-5.7%	0.8%	-8.8%	-5.4%	2.9%	-1.3%	-5.0%
Growth Momentum Stocks	11.5%	0.8%	0.7%	-3.8%	0.8%	2.5%	1.4%
Lynch Stocks	22.1%	1.0%	5.5%	1.0%	1.1%	2.7%	0.6%
Buffett Stocks	19.3%	1.7%	2.9%	-0.5%	0.8%	2.1%	0.5%
Graham Stocks	8.8%	0.8%	-0.3%	-1.2%	-1.6%	0.6%	2.1%
Templeton Stocks	3.7%	1.0%	1.4%	-0.2%	-0.9%	1.6%	1.0%
Zweig Stocks	11.0%	0.6%	3.7%	-1.4%	0.3%	2.3%	2.6%
Average Long Stocks	8.5%	1.0%	0.0%	-1.7%	0.4%	1.1%	0.2%

Key

Passed Recent Filter

Price declined by half of stop loss setting

Oversold  based on  Williams %R  (%R2 is most recent)

Overbought based on Williams %R  (%R2 is most recent)

      Companies that have experienced net insider buying within the past 6 months of 5% or more of issued stock are listed in Table 3B.  These stocks should also appear in one of the master trader screens or meet additional screening criteria before being given serious consideration.  This list is a mixture of stocks that are optionable and those that are not.

Table 3B

Net Insider Buying Check List

Stock	Reference	% Chg	Company	Sector	Industry	% from Max	Monthly % Gain	%R1	%R2
LXU	12/23/05	-1.3%	LSB Industries, Inc.	Basic Materials	Chemical Manufacturing	-6.8%	-6.0%	-63	-87
MMLP	11/25/05	0.0%	Martin Midstream Partners L.P.	Transportation	Water Transportation	-8.5%	0.3%	-70	-66
MBRX	03/10/06	0.0%	Metabasis Therapeutics, Inc.	Health Care	Biotechnology & Drugs	0.0%	-1.6%	-57	-61
TXCC	03/10/06	0.0%	TranSwitch Corporation	Technology	Semiconductors	0.0%	-6.6%	-59	-59
SNSS	12/16/05	24.7%	Sunesis Pharmaceuticals, Inc.	Health Care	Major Drugs	-2.5%	25.5%	-50	-39
VSTA	10/21/05	10.5%	VistaCare, Inc.	Health Care	Healthcare Facilities	-2.1%	3.5%	-63	-28

      Companies with net cash positions that comprise at least 40% of their share price are listed in Table 3C.  These stocks should also appear in one of the master trader screens or meet additional screening criteria before being given serious consideration.  Again, this list is a mixture of stocks that are optionable and those that are not.

Table 3C

Capital Rich Companies Check List

Stock	Reference	% Chg	Company	Sector	Industry	% from Max	Monthly % Gain	%R1	%R2
CLCT	03/10/06	0.0%	Collectors Universe, Inc.	Services	Business Services	0.0%	-11.8%	-83	-84
HRAY	03/03/06	0.3%	Hurray! Holding Co., Ltd. (ADR)	Services	Communications Services	-0.3%	-3.7%	-81	-75
EDGW	03/10/06	0.0%	Edgewater Technology Inc.	Technology	Computer Services	0.0%	-6.5%	-58	-44

      Table 3D was added to contain companies having a low price to free cash flow (P-FCF) less than 5.  Companies having P-FCF less than 10 are typically capable of financing the purchase of all their outstanding shares of stock.

Table 3D

Price to Free Cash Flow Companies Check List

Stock	Reference	% Chg	Company	Sector	Industry	% from Max	Monthly % Gain	%R1	%R2
BBI	01/20/06	-5.7%	Blockbuster Inc.	Services	Recreational Activities	-13.5%	-8.8%	-84	-79

      For the Peter Lynch screen in Table 3E, the number of selections is reduced by selecting only optionable stocks having P/E’s less than 30. 

Table 3E

Peter Lynch Value Watch List

Stock	Reference	% Chg	Company	Sector	Industry	% from Max	Monthly % Gain	%R1	%R2
SKM	02/07/05	15.5%	SK Telecom Co., Ltd. (ADR)	Services	Communications Services	-5.2%	-2.9%	-67	-77
KOF	04/29/05	33.2%	Coca-Cola FEMSA, S.A. (ADR)	Consumer Non-Cyclical	Beverages (Non-Alcoholic)	-2.4%	2.4%	-51	-44
TM	12/13/04	42.2%	Toyota Motor Corporation (ADR)	Consumer Cyclical	Auto & Truck Manufacturers	-1.9%	3.3%	-39	-30
BTI	08/12/05	23.8%	British American Tobacco (ADR)	Consumer Non-Cyclical	Tobacco	-1.3%	8.7%	-10	-13
AZN	02/03/06	6.3%	AstraZeneca PLC (ADR)	Health Care	Major Drugs	0.0%	7.6%	-16	-2
PKX	02/17/06	11.5%	POSCO (ADR)	Basic Materials	Iron & Steel	0.0%	3.4%	-29	-1

      For the  screen in Table 3F, the number of selections is reduced by selecting only optionable stocks having P/E’s less than 30. 

Table 3F

 Growth Momentum Watch List

Stock	Reference	% Chg	Company	Sector	Industry	% from Max	Monthly % Gain	%R1	%R2
LM	08/12/05	14.7%	Legg Mason, Inc.	Financial	Investment Services	-8.3%	-4.7%	-92	-96
APC	02/10/06	0.0%	Anadarko Petroleum Corporation	Energy	Oil & Gas Operations	-7.6%	-3.7%	-92	-87
UNH	04/15/05	20.4%	UnitedHealth Group Inc.	Financial	Insurance (Accident & Health)	-11.9%	-4.1%	-77	-80
AHC	02/03/06	0.0%	Amerada Hess Corporation	Energy	Oil & Gas - Integrated	-6.9%	0.3%	-90	-80
BHP	09/09/05	10.4%	BHP Billiton Limited (ADR)	Basic Materials	Metal Mining	-12.1%	-2.8%	-86	-78
PCU	12/02/05	19.0%	Southern Copper Corporation (USA)	Basic Materials	Metal Mining	-12.4%	-3.9%	-85	-73
DNR	03/03/06	-7.4%	Denbury Resources Inc.	Energy	Oil & Gas Operations	-7.4%	-0.5%	-73	-71
WSO	11/25/05	11.9%	Watsco, Incorporated	Capital Goods	Misc. Capital Goods	-5.6%	-3.5%	-85	-63
BEN	11/04/05	6.7%	Franklin Resources, Inc.	Financial	Investment Services	-6.1%	2.8%	-62	-63
BR	02/24/06	-2.9%	Burlington Resources Inc.	Energy	Oil & Gas Operations	-2.9%	1.2%	-62	-62
CHB	02/17/06	-5.7%	Champion Enterprises, Inc.	Capital Goods	Construction Services	-9.9%	-4.2%	-59	-55
ET	10/21/05	36.1%	E*TRADE FINANCIAL Corporation	Financial	Investment Services	-5.3%	4.0%	-58	-49
CHE	05/06/05	41.3%	Chemed Corporation	Services	Business Services	-3.7%	6.0%	-40	-34
SYT	04/08/05	30.6%	Syngenta AG (ADR)	Basic Materials	Chemical Manufacturing	-4.4%	-0.3%	-41	-33
WCC	02/10/06	4.9%	WESCO International, Inc.	Technology	Electronic Instruments & Controls	-6.8%	4.9%	-33	-31
HCC	10/21/05	20.2%	HCC Insurance Holdings, Inc.	Financial	Insurance (Property & Casualty)	-1.4%	-0.6%	-43	-28
ENDP	02/17/06	4.9%	Endo Pharmaceuticals	Health Care	Biotechnology & Drugs	-5.3%	-3.5%	-19	-16
GRMN	03/03/06	1.0%	Garmin Ltd.	Technology	Communications Equipment	-0.8%	12.4%	-8	-12

      The filter for Warren Buffet style stock picking in Table 3G is for the intermediate to long term.  Two requirements were added.  One was to include only optionable stocks in order to find LEAPS opportunities.  The other requirement was to include only those stocks having a PE of 17 or less.

Table 3G

Warren Buffett Value Watch List

Stock	Reference	% Chg	Company	Sector	Industry	% from Max	Monthly % Gain	%R1	%R2
ANF	03/03/06	-4.3%	Abercrombie & Fitch Co.	Services	Retail (Apparel)	-4.3%	-16.9%	-94	-93
FNF	10/21/05	-2.4%	Fidelity National Financial	Financial	Insurance (Property & Casualty)	-9.7%	-3.8%	-93	-88
MDC	01/20/06	-8.5%	M.D.C. Holdings, Inc.	Capital Goods	Construction Services	-8.5%	-1.6%	-93	-81
KSWS	10/14/05	1.0%	K-Swiss Inc.	Consumer Cyclical	Footwear	-14.9%	-0.4%	-81	-77
HDI	10/14/05	3.2%	Harley-Davidson, Inc.	Consumer Cyclical	Recreational Products	-9.0%	-1.9%	-92	-76
LNCR	12/27/04	-4.5%	Lincare Holdings Inc.	Health Care	Healthcare Facilities	-12.6%	-3.4%	-81	-74
PCU	02/10/06	-3.9%	Southern Copper Corporation (USA)	Basic Materials	Metal Mining	-6.6%	-3.9%	-85	-73
CCRT	12/30/05	0.0%	CompuCredit Corporation	Financial	Consumer Financial Services	-8.2%	-5.3%	-91	-70
UNT	03/03/06	-6.4%	Unit Corporation	Energy	Oil & Gas Operations	-6.4%	-6.4%	-71	-69
TBL	02/17/06	-2.0%	The Timberland Company	Consumer Cyclical	Footwear	-2.2%	-2.7%	-71	-69
ABFS	04/29/05	33.0%	Arkansas Best Corporation	Transportation	Trucking	-7.8%	-3.1%	-90	-63
OXY	03/03/06	-5.1%	Occidental Petroleum Corporation	Energy	Oil & Gas Operations	-5.1%	3.6%	-63	-62
TOL	02/17/06	5.5%	Toll Brothers, Inc.	Capital Goods	Construction Services	-6.4%	-4.9%	-68	-56
ASH	10/28/05	21.1%	Ashland Inc.	Capital Goods	Construction Services	-2.4%	0.5%	-73	-52
DSPG	02/07/05	10.6%	DSP Group, Inc.	Technology	Communications Equipment	-8.0%	3.0%	-54	-49
NKE	09/23/05	4.6%	NIKE, Inc.	Consumer Cyclical	Footwear	-7.1%	0.6%	-36	-43
AH	02/03/06	12.7%	Armor Holdings, Inc.	Capital Goods	Aerospace and Defense	-3.7%	15.1%	-33	-32
RS	04/15/05	118.9%	Reliance Steel & Aluminum	Basic Materials	Misc. Fabricated Products	-4.1%	8.1%	-48	-31
SCHN	02/10/06	5.2%	Schnitzer Steel Industries, Inc.	Basic Materials	Iron & Steel	-1.2%	5.2%	-87	-31
CECO	02/17/06	1.8%	Career Education Corp.	Services	Schools	0.0%	2.8%	-35	-28
RI	09/02/05	32.8%	Ruby Tuesday, Inc.	Services	Restaurants	-1.1%	3.3%	-18	-25
ACS	04/29/05	33.0%	Affiliated Computer Services, Inc.	Technology	Computer Services	-0.1%	1.4%	-23	-15
STLD	12/16/05	41.7%	Steel Dynamics, Inc.	Basic Materials	Iron & Steel	0.0%	12.1%	-45	-14
BTI	12/30/05	10.7%	British American Tobacco (ADR)	Consumer Non-Cyclical	Tobacco	-1.3%	8.7%	-10	-13
THO	04/15/05	95.5%	Thor Industries, Inc.	Capital Goods	Mobile Homes & RVs	0.0%	21.8%	-16	-2
AEOS	03/10/06	0.0%	American Eagle Outfitters	Services	Retail (Apparel)	0.0%	12.4%	-14	-1
RCII	10/21/05	51.8%	Rent-A-Center, Inc	Services	Rental & Leasing	0.0%	6.5%	-17	-1
NUE	04/15/05	94.9%	Nucor Corporation	Basic Materials	Iron & Steel	0.0%	18.2%	-29	0

      Stocks from Benjamin Graham’s style of utility investing are listed in Table 3H.  A requirement was added to include only those stocks having a PE of 17 or less. 

Table 3H

Benjamin Graham Utility Watch List

Stock	Reference	% Chg	Company	Sector	Industry	% from Max	Monthly % Gain	%R1	%R2
WPS	02/07/05	-0.8%	WPS Resources Corp	Utilities	Electric Utilities	-14.2%	-2.9%	-97	-92
VVC	03/03/06	-0.8%	Vectren Corporation	Utilities	Natural Gas Utilities	-0.8%	-2.6%	-98	-92
CPK	05/06/05	16.3%	Chesapeake Utilities	Utilities	Natural Gas Utilities	-14.1%	-2.0%	-70	-80
WGL	12/23/05	-1.6%	WGL Holdings, Inc.	Utilities	Natural Gas Utilities	-4.6%	-0.7%	-90	-80
PNW	01/10/05	-8.0%	Pinnacle West Capital	Utilities	Electric Utilities	-14.6%	-5.1%	-84	-77
SRE	01/10/05	28.7%	Sempra Energy	Utilities	Natural Gas Utilities	-4.5%	-0.8%	-89	-72
EON	03/10/06	0.0%	E.ON AG (ADR)	Utilities	Electric Utilities	0.0%	-0.5%	-96	-66
ATO	04/01/05	-2.1%	Atmos Energy Corporation	Utilities	Natural Gas Utilities	-11.4%	0.3%	-79	-63
ATG	10/21/05	6.6%	AGL Resources Inc.	Utilities	Natural Gas Utilities	-3.0%	-0.5%	-66	-57
UU	06/10/05	-0.6%	United Utilities PLC (ADR)	Utilities	Electric Utilities	-2.8%	-1.6%	-93	-57
UGI	12/30/05	4.7%	UGI Corporation	Utilities	Natural Gas Utilities	-4.5%	-0.9%	-54	-56
PGN	01/10/05	-0.8%	Progress Energy, Inc.	Utilities	Electric Utilities	-4.5%	1.8%	-59	-54
OKE	11/11/05	8.7%	ONEOK, Inc.	Utilities	Natural Gas Utilities	-7.4%	10.0%	-53	-48
KEP	01/10/05	73.4%	Korea Electric Power Corporation (ADR)	Utilities	Electric Utilities	-5.8%	1.1%	-58	-45

      Optionable stocks from John Templeton’s style of investing are listed in Table 3I. 

Table 3I

John Templeton Watch List

Stock	Reference	% Chg	Company	Sector	Industry	% from Max	Monthly % Gain	%R1	%R2
GTRC	03/03/06	-2.8%	Guitar Center, Inc.	Services	Retail (Specialty Non-Apparel)	-2.8%	-12.0%	-95	-89
DHI	03/03/06	-3.1%	D.R. Horton Inc.	Capital Goods	Construction Services	-3.1%	-3.7%	-97	-87
CAKE	10/21/05	4.4%	The Cheesecake Factory Incorporated	Services	Restaurants	-7.0%	-1.6%	-85	-83
MDC	12/30/05	-4.0%	M.D.C. Holdings, Inc.	Capital Goods	Construction Services	-10.9%	-1.6%	-93	-81
UNH	12/30/05	-9.6%	UnitedHealth Group Inc.	Financial	Insurance (Accident & Health)	-10.7%	-4.1%	-77	-80
HDI	02/24/06	-3.3%	Harley-Davidson, Inc.	Consumer Cyclical	Recreational Products	-4.8%	-1.0%	-92	-76
SNV	05/27/05	-6.9%	Synovus Financial Corp.	Financial	Regional Banks	-9.0%	-2.4%	-76	-74
PCU	02/10/06	-3.9%	Southern Copper Corporation (USA)	Basic Materials	Metal Mining	-6.6%	-3.9%	-85	-73
HHS	10/28/05	11.2%	Harte-Hanks, Inc.	Services	Printing & Publishing	-5.6%	-2.1%	-57	-59
TOL	03/03/06	-4.9%	Toll Brothers, Inc.	Capital Goods	Construction Services	-4.9%	-4.9%	-68	-56
JBHT	02/03/06	2.7%	J.B. Hunt Transport Services, Inc.	Transportation	Trucking	-7.3%	-2.9%	-68	-55
AMSG	10/14/05	-3.7%	AmSurg Corp.	Health Care	Healthcare Facilities	-9.1%	3.7%	-59	-54
LOW	11/18/05	-0.8%	Lowe's Companies, Inc.	Services	Retail (Home Improvement)	-5.8%	4.4%	-50	-50
WSM	09/02/05	4.5%	Williams-Sonoma, Inc.	Services	Retail (Specialty Non-Apparel)	-12.0%	3.3%	-52	-44
ORLY	01/20/06	14.7%	O'Reilly Automotive, Inc.	Services	Retail (Specialty Non-Apparel)	-4.0%	8.0%	-46	-42
GISX	12/30/05	4.0%	Global Imaging Systems, Inc.	Technology	Office Equipment	-2.1%	2.4%	-66	-41
MIK	12/30/05	-6.2%	Michaels Stores, Inc.	Services	Retail (Specialty Non-Apparel)	-6.2%	2.8%	-57	-38
EWBC	12/30/05	1.5%	East West Bancorp, Inc.	Financial	Regional Banks	-2.2%	3.8%	-62	-36
DGX	08/19/05	5.6%	Quest Diagnostics Incorporated	Health Care	Healthcare Facilities	-1.8%	2.0%	-28	-30
JNJ	02/17/06	-0.1%	Johnson & Johnson	Health Care	Major Drugs	-0.2%	2.7%	-47	-22
CHD	11/18/05	8.8%	Church & Dwight Co., Inc.	Consumer Non-Cyclical	Personal & Household Products	-1.3%	9.0%	-27	-20
CPS	05/27/05	11.8%	ChoicePoint Inc.	Services	Business Services	-3.2%	1.1%	-22	-19
SFG	05/27/05	44.7%	StanCorp Financial Group, Inc.	Financial	Insurance (Life)	-0.6%	4.2%	-22	-8
EDMC	12/16/05	24.1%	Education Management Corp	Services	Schools	-0.7%	18.5%	-4	-5

      Optionable stocks from Martin Zweig’s style of investing are listed in Table 3J. 

Table 3J

Martin Zweig Watch List

Stock	Reference	% Chg	Company	Sector	Industry	% from Max	Monthly % Gain	%R1	%R2
MDU	01/27/06	-4.2%	MDU Resources Group, Inc.	Utilities	Natural Gas Utilities	-8.0%	-5.0%	-92	-93
RDC	03/03/06	-9.8%	Rowan Companies, Inc.	Energy	Oil Well Services & Equipment	-9.8%	-10.4%	-88	-90
MOT	01/20/06	-7.1%	Motorola, Inc.	Technology	Communications Equipment	-9.0%	-3.3%	-66	-82
DNR	03/03/06	-7.4%	Denbury Resources Inc.	Energy	Oil & Gas Operations	-7.4%	-0.5%	-73	-71
BEN	10/28/05	12.3%	Franklin Resources, Inc.	Financial	Investment Services	-6.1%	2.8%	-62	-63
BR	12/02/05	19.4%	Burlington Resources Inc.	Energy	Oil & Gas Operations	-3.2%	1.2%	-62	-62
CRDN	08/19/05	81.4%	Ceradyne, Inc.	Capital Goods	Aerospace and Defense	-11.4%	6.7%	-70	-62
ESI	11/04/05	3.5%	ITT Educational Services	Services	Schools	-5.0%	-2.1%	-68	-47
HTLD	01/27/06	7.8%	Heartland Express, Inc.	Transportation	Trucking	-4.4%	-0.6%	-70	-46
STRA	01/13/06	7.5%	Strayer Education, Inc.	Services	Schools	-5.5%	5.5%	-43	-42
ORLY	03/10/06	0.0%	O'Reilly Automotive, Inc.	Services	Retail (Specialty Non-Apparel)	0.0%	8.0%	-46	-42
MINI	03/03/06	2.6%	Mobile Mini, Inc.	Services	Business Services	-1.3%	7.0%	-32	-34
JOSB	01/06/06	15.2%	Jos. A. Bank Clothiers, Inc.	Services	Retail (Apparel)	-2.6%	4.4%	-56	-34
LSTR	02/10/06	5.6%