Wiser Trader Stocks and Options Newsletter

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Issue No. 73 April 10, 2006 Prescott, Arizona Systems@WiserTrader.com

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1.0 Trading

The S&P 500 clings to the upper edge of its trading range.

1.1 Wall of Worry

The chart in Figure 1 illustrates how the market continues to climb a wall of worry. The S&P is about 4% above its 200-day SMA.

FIGURE 1

© 2006 WiserTrader.com, LLC. Members of wisertrader.com are neither licensed brokers nor licensed advisors. Trades discussed represent recommendations made by the editor for the wisertrader.com portfolio. The newsletter and web site are for information only and should not be considered as personal advice. While it is believed that the posted information is factual, mistakes can be made in transcription. Investors should trade stocks only after verifying all information and consulting with a licensed broker or adviser. WiserTrader.commarkets third party trading systems but has no other affiliation with trading system companies.

1.2 Filter Studies

Continuing with filter performance studies, the latest 1 year period is shown at the bottom of Table 1. Details of the filters can be found on the web site. Currently we are tracking filter performance with the S&P 500 Index 30-day SMA (simple moving average) relative to its 200-day SMA 1 month prior to the dates listed.

Table 1

1 Year Filter Performance Using No Trailing Stop

Year Ending	Prior Year S&P 500	Month Ago S&P 500 SMA 30 vs SMA 200	Growth $15-$40 Filter	Growth >$40 Filter	Absolute Value Filter	Relative Value Filter
9/02/05	9.4%	+2.8%	60.1%	40.7%	19.3%	50%
9/30/05	8.6%	+1.8%	25.4%	61.4%	12.3%	24.1
11/04/05	8.0%	-0.1%	8.2%	14.8%	4.4%	-0.6%
12/02/05	6.2%	+1.9%	24.6%	9.6%	17.0%	34.7%
01/06/06	8.2%	+4.1%	39.8%	50.3%	27.8%	28.3%
02/03/06	6.1%	+4.2%	34.8%	60.7%	11.5%	34.3%
03/03/06	5.7%	+3.5%	32.7%	26.4%	11.0%	29.7%
04/07/06	9.5%	+3.3%	25.2%	61.2%	16.1%	18.4%

The data continues to confirm that stocks selected by either filter do best when the S&P 500 remains several percent above its 200-day SMA for the most recent month. The performance shown is for cases where no trailing stops were used.

1.3 Trailing Stop Settings

Table 2 shows how typical profits change as the trailing stop is widened from -10% to -100%, essentially no stop setting at all. One factor in such performance is that the S&P 500 has been in a bull market over the past year, all be it with a saw tooth rising wedge pattern. Another factor is the quality of the filters themselves.

In some cases, an advantage is seen in using a trailing stop for the most recent 1-year period. The arrow in Figure 1 shows the approximate date that stocks were selected, just before a steep downturn in April 2005. A tight trailing stop at that point would have been beneficial. In most cases, stocks recovered from the initial down turn and a wider trailing stop resulted in better performance. Shaded areas of the table show where no stop was triggered.

In some cases, a fixed nominal trailing stop setting X% can be improved upon by applying a trailing stop to each individual stock based on its highest percentage gain. The variable value applied to stocks individually is,

Variable trailing stop percentage = Highest_%Gain / 3 - X%

This effectively tightens the trailing stop as the stock price rises in order to preserve gains. The variable trailing stop percentage should not be allowed to expand wider than X or be allowed to narrow to more than -10%. A variable trailing stop was, in many cases, superior to a fixed trailing stop over the past year. The improvement is more likely when the trailing stop setting is narrower than -35% in an up trending market. Results depend on market behavior.

Table 2

1-Year %Gains with Variable and Fixed Trailing Stop Settings

	Absolute Value		Relative Value		Growth $15 to $40		Growth > $40
“X“ Nominal Stop Setting (%)	Variable Trailing Stop	Fixed Trailing Stop	Variable Trailing Stop	Fixed Trailing Stop	Variable Trailing Stop	Fixed Trailing Stop	Variable Trailing Stop	Fixed Trailing Stop
-10	18.8%	18.8%	18.9%	18.9%	-0.2%	-0.2%	54.3%	54.3%
-15	17.2%	17.2%	34.1%	34.1%	19.9%	19.9%	56.5%	56.5%
-20	17.0%	15.8%	27.8%	27.1%	16.6%	17.6%	60.8%	60.8%
-25	16.4%	16.4%	27.8%	27.8%	13.3%	10.8%	60.8%	60.8%
-30	16.4%	16.4%	27.8%	27.8%	13.5%	8.4%	61.2%	61.2%
-35	16.1%	16.1%	22.8%	26.0%	16.2%	16.2%	61.2%	61.2%
-40	16.1%	16.1%	22.8%	22.8%	16.2%	16.2%	61.2%	61.2%
-50	16.1%	16.1%	18.4%	18.4%	25.2%	16.2%	61.2%	61.2%
-60	16.1%	16.1%	18.4%	18.4%	25.2%	16.2%	61.2%	61.2%
-70	16.1%	16.1%	18.4%	18.4%	25.2%	25.2%	61.2%	61.2%
-80	16.1%	16.1%	18.4%	18.4%	25.2%	25.2%	61.2%	61.2%
-90	16.1%	16.1%	18.4%	18.4%	25.2%	25.2%	62.4%	61.2%
-100	16.1%	16.1%	18.4%	18.4%	25.2%	25.2%	62.4%	61.2%

Applying trailing stops to individual stocks may seem like many details to keep track of, but not really. The easiest way is to put the data and formulas in an Excel spreadsheet and use XLQ which can automatically retrieve stock prices from Yahoo and MSN.

2.0 Market Analysis

This week bond yields rose more sharply and interest rate sensitive stocks continued to consolidate. The major averages pulled back in unison. As earnings season begins this week, concern is being placed on inflation and interest rates due to high energy and commodity prices with lower unemployment.

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	0.4%	0.1%	-1.5%	0.0%	1.8%
NASDAQ Composite Index	3.4%	0.0%	1.2%	0.3%	2.0%
NYSE Composite Index	1.1%	0.0%	-0.6%	-0.3%	2.0%
S & P 500 Index	2.4%	0.5%	-0.2%	-0.2%	2.4%
Russell 2000 Index	4.1%	-1.2%	1.5%	1.0%	2.7%
HGX, Phil. Housing Index	7.6%	2.3%	-1.7%	-0.3%	7.4%
IYR, Real Estate	-1.3%	-3.6%	1.1%	-3.0%	4.4%
GLD, GOLD	8.8%	0.8%	4.3%	1.1%	2.4%
RKH, Banking	0.2%	0.1%	-1.4%	-0.5%	2.0%
IYT, Transportation	5.3%	2.4%	1.0%	-0.7%	2.4%
SMH, Semiconductors	2.7%	1.6%	0.3%	1.8%	-1.1%
BBH, Biotechnology	-3.0%	-4.0%	-0.3%	-2.4%	3.8%
OIH, Oil	12.2%	2.7%	2.9%	1.0%	5.1%
XLE, Energy	7.7%	1.7%	1.0%	0.4%	4.4%
XLU, Utilities	-3.3%	-0.5%	-2.1%	-2.1%	1.4%
XLB, Materials	4.8%	1.4%	0.9%	-0.4%	2.8%
XLI, Industrial	3.3%	0.4%	0.4%	-0.3%	2.9%
XLK, Technology	2.5%	0.5%	0.2%	-0.1%	1.8%
XLV, Healthcare	-3.5%	-2.2%	-2.1%	-0.1%	0.9%
XLF, Financials	-0.2%	0.1%	-1.0%	-0.7%	1.4%
XLP, Consumer Staples	-3.1%	-0.8%	-1.6%	0.1%	-0.8%
XLY, Consumer Discretionary	1.5%	0.6%	-0.4%	-0.7%	2.0%

The VIX and VXN volatility indexes are listed in Table 2B.

Table 2B

Volatility

Indicator	Current	Last Week	2 Weeks Ago	Complacent	Cautious
VIX **	12.3	11.4	11.2	< 20	> 50
VXN ***	15.9	16.3	15.9	< 30	> 70
Above 20 day SMA = Short-term sell signal. * At 20 day SMA = Short-term neutral signal.

Figure 4 compares the major averages with key ETF’s and Sector SPDR’s.

FIGURE 4

Table 2C

Market Summary

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. The information is not meant to imply any endorsement or sponsorship by these 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	7.4%	-0.4%	11.4%	-0.9%	0.6%	3.6%	7.2%
Cash Rich Companies	-1.1%	0.7%	-0.7%	-1.2%	-0.4%	0.0%	0.9%
Price to Free Cash Flow	10.3%	2.3%	15.4%	-4.5%	10.5%	-1.5%	11.4%
Growth Momentum Stocks	16.6%	-1.5%	9.1%	0.5%	2.1%	0.8%	5.5%
Lynch Stocks	25.9%	-1.1%	3.0%	0.7%	1.5%	-0.8%	1.6%
Buffett Stocks	27.0%	-1.1%	5.6%	1.1%	1.9%	0.6%	1.9%
Graham Stocks	13.5%	-1.0%	1.9%	0.3%	-0.1%	-0.5%	2.1%
Templeton Stocks	6.8%	-0.3%	3.2%	0.3%	-0.1%	0.6%	2.4%
Zweig Stocks	9.9%	-0.9%	5.5%	0.7%	0.7%	1.0%	3.0%
Average Long Stocks	12.9%	-0.4%	6.0%	-0.3%	1.8%	0.4%	4.0%

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
NXTM	03/17/06	0.0%	NxStage Medical, Inc.	Health Care	Biotechnology & Drugs	-12.3%	-14.0%	-99	-99
RGN	03/17/06	0.0%	RegeneRx Biopharmaceut.	Health Care	Biotechnology & Drugs	-5.4%	-6.3%	-73	-73
VSTA	10/21/05	7.3%	VistaCare, Inc.	Health Care	Healthcare Facilities	-13.0%	-2.9%	-70	-70
MMLP	11/25/05	0.0%	Martin Midstream Partners L.P.	Transportation	Water Transportation	-3.3%	5.7%	-45	-45
FVRL	03/17/06	0.0%	Favrille, Inc.	Health Care	Biotechnology & Drugs	-11.1%	11.2%	-45	-45
CLRT	03/24/06	0.9%	Clarient, Inc.	Technology	Scientific & Technical Instruments	-0.9%	0.0%	-50	-39
TXCC	03/10/06	50.3%	TranSwitch Corporation	Technology	Semiconductors	-9.5%	50.3%	-24	-24
LXU	12/23/05	15.9%	LSB Industries, Inc.	Basic Materials	Chemical Manufacturing	-1.6%	17.4%	-10	-10
RGNC	04/07/06	0.0%	Regency Energy Partners LP	Utilities	Natural Gas Utilities	0.0%	10.9%	-6	-6
NEU	03/31/06	0.0%	NewMarket Corporation	Basic Materials	Chemical Manufacturing	0.0%	41.3%	0	0

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	-3.4%	Collectors Universe, Inc.	Services	Business Services	-3.5%	-3.4%	-93	-93
WSC	03/11/06	0.1%	Wesco Financial Corporation	Conglomerates	Conglomerates	-0.2%	0.1%	-72	-67
SCIX	04/07/06	0.0%	Scailex Corp., Ltd. (USA)	Technology	Computer Networks	0.0%	1.4%	-45	-48

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
LNX	03/31/06	-7.6%	Lenox Group Inc.	Consumer Non-Cyclical	Personal & Household Products	-7.6%	-7.6%	-96	-97
MOVI	03/24/06	20.8%	Movie Gallery, Inc.	Services	Recreational Activities	-5.6%	-5.6%	-48	-35
KWD	03/04/06	17.6%	Kellwood Company	Consumer Cyclical	Apparel/Accessories	-1.6%	12.5%	-3	-12

For the Peter Lynch style 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
BTI	08/12/05	20.4%	British American Tobacco (ADR)	Consumer Non-Cyclical	Tobacco	-5.7%	-2.7%	-79	-79
SKM	02/07/05	17.4%	SK Telecom Co., Ltd. (ADR)	Services	Communications Services	-3.6%	1.6%	-54	-52
KOF	04/29/05	43.1%	Coca-Cola FEMSA, S.A. (ADR)	Consumer Non-Cyclical	Beverages (Non-Alcoholic)	-3.0%	7.4%	-36	-36
PKX	02/17/06	13.5%	POSCO (ADR)	Basic Materials	Iron & Steel	-3.5%	-1.0%	-34	-34
TM	12/13/04	52.1%	Toyota Motor Corporation (ADR)	Consumer Cyclical	Auto & Truck Manufacturers	-0.7%	7.0%	-13	-13
AZN	02/03/06	9.1%	AstraZeneca PLC (ADR)	Health Care	Major Drugs	-1.2%	2.7%	-11	-11

For the Growth Momentum 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
ENDP	02/17/06	3.8%	Endo Pharmaceuticals	Health Care	Biotechnology & Drugs	-7.5%	-5.7%	-97	-97
WSO	11/25/05	8.1%	Watsco, Incorporated	Capital Goods	Misc. Capital Goods	-8.8%	-3.4%	-92	-92
LM	08/12/05	14.6%	Legg Mason, Inc.	Financial	Investment Services	-8.3%	-0.1%	-82	-82
BEN	11/04/05	4.2%	Franklin Resources, Inc.	Financial	Investment Services	-8.3%	-2.3%	-81	-81
SYT	04/08/05	30.8%	Syngenta AG (ADR)	Basic Materials	Chemical Manufacturing	-5.0%	0.1%	-71	-71
HCC	10/21/05	22.7%	HCC Insurance Holdings, Inc.	Financial	Insurance (Property & Casualty)	-4.1%	2.1%	-47	-47
UIC	03/17/06	10.5%	United Industrial Corp.	Capital Goods	Aerospace and Defense	-8.5%	18.0%	-37	-37
APC	02/10/06	0.0%	Anadarko Petroleum Corporation	Energy	Oil & Gas Operations	-2.7%	7.5%	-30	-30
CHB	02/17/06	0.2%	Champion Enterprises, Inc.	Capital Goods	Construction Services	-4.3%	6.2%	-28	-25
AHC	02/03/06	0.0%	Amerada Hess Corporation	Energy	Oil & Gas - Integrated	-2.4%	5.2%	-24	-24
CHE	05/06/05	50.5%	Chemed Corporation	Services	Business Services	-2.0%	6.6%	-22	-22
SM	03/17/06	2.1%	St. Mary Land & Exploration Co.	Energy	Oil & Gas Operations	-1.8%	9.2%	-21	-21
RIO	03/31/06	0.4%	Companhia Vale do Rio Doce (ADR)	Basic Materials	Metal Mining	-2.2%	12.6%	-19	-19
PCU	12/02/05	34.5%	Southern Copper Corporation (USA)	Basic Materials	Metal Mining	-2.3%	13.0%	-19	-19
GRMN	03/03/06	11.2%	Garmin Ltd.	Technology	Communications Equipment	-2.2%	10.0%	-15	-16
BHP	09/09/05	34.5%	BHP Billiton Limited (ADR)	Basic Materials	Metal Mining	-2.4%	21.8%	-15	-15
OVTI	03/17/06	13.8%	OmniVision Technologies	Technology	Semiconductors	-2.0%	22.6%	-12	-12
ET	10/21/05	50.7%	E*TRADE FINANCIAL Corporation	Financial	Investment Services	-1.1%	10.7%	-12	-12
WCC	02/10/06	27.5%	WESCO International, Inc.	Technology	Electronic Instruments & Controls	-1.4%	21.5%	-11	-11
DNR	03/03/06	12.6%	Denbury Resources Inc.	Energy	Oil & Gas Operations	-0.9%	21.6%	-8	-8

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
NKE	09/23/05	2.9%	NIKE, Inc.	Consumer Cyclical	Footwear	-8.5%	-1.6%	-98	-98
ACS	04/29/05	25.3%	Affiliated Computer Services, Inc.	Technology	Computer Services	-5.8%	-5.8%	-81	-81
BTI	12/30/05	7.7%	British American Tobacco (ADR)	Consumer Non-Cyclical	Tobacco	-5.7%	-2.7%	-79	-79
ANF	03/03/06	-5.5%	Abercrombie & Fitch Co.	Services	Retail (Apparel)	-5.5%	-1.2%	-87	-75
TBL	02/17/06	-3.7%	The Timberland Company	Consumer Cyclical	Footwear	-3.9%	-1.8%	-58	-58
FNF	10/21/05	-1.5%	Fidelity National Financial	Financial	Insurance (Property & Casualty)	-8.9%	0.9%	-67	-58
KSWS	10/14/05	2.2%	K-Swiss Inc.	Consumer Cyclical	Footwear	-13.8%	1.2%	-54	-54
JBHT	03/31/06	5.2%	J.B. Hunt Transport Services, Inc.	Transportation	Trucking	-0.8%	-5.1%	-53	-53
ABFS	04/29/05	29.7%	Arkansas Best Corporation	Transportation	Trucking	-10.2%	-2.6%	-49	-48
CCRT	12/30/05	-3.7%	CompuCredit Corporation	Financial	Consumer Financial Services	-11.6%	-3.7%	-48	-48
AEOS	03/10/06	1.9%	American Eagle Outfitters	Services	Retail (Apparel)	-2.3%	1.9%	-33	-39
ASH	10/28/05	28.8%	Ashland Inc.	Capital Goods	Construction Services	-3.1%	6.3%	-36	-36
OXY	03/03/06	0.1%	Occidental Petroleum Corporation	Energy	Oil & Gas Operations	-2.4%	5.6%	-32	-32
DSPG	02/07/05	12.6%	DSP Group, Inc.	Technology	Communications Equipment	-6.4%	1.8%	-31	-31
RI	09/02/05	44.7%	Ruby Tuesday, Inc.	Services	Restaurants	-2.6%	9.0%	-31	-31
RS	04/15/05	140.9%	Reliance Steel & Aluminum	Basic Materials	Misc. Fabricated Products	-3.6%	10.1%	-29	-29
CECO	02/17/06	18.1%	Career Education Corp.	Services	Schools	-4.1%	6.0%	-26	-27
UNT	03/03/06	-0.1%	Unit Corporation	Energy	Oil & Gas Operations	-2.0%	0.0%	-26	-26
RCII	10/21/05	61.1%	Rent-A-Center, Inc	Services	Rental & Leasing	-1.2%	6.1%	-24	-24
AH	02/03/06	20.6%	Armor Holdings, Inc.	Capital Goods	Aerospace and Defense	-1.6%	7.0%	-20	-20
PCU	02/10/06	8.7%	Southern Copper Corporation (USA)	Basic Materials	Metal Mining	-2.3%	13.0%	-19	-19
STLD	12/16/05	65.3%	Steel Dynamics, Inc.	Basic Materials	Iron & Steel	-3.2%	16.7%	-18	-18
THO	04/15/05	106.7%	Thor Industries, Inc.	Capital Goods	Mobile Homes & RVs	-0.5%	5.7%	-13	-15
HDI	10/14/05	6.6%	Harley-Davidson, Inc.	Consumer Cyclical	Recreational Products	-6.0%	3.3%	-15	-15
NUE	04/15/05	122.1%	Nucor Corporation	Basic Materials	Iron & Steel	-2.3%	13.9%	-14	-14
SCHN	02/10/06	36.0%	Schnitzer Steel Industries, Inc.	Basic Materials	Iron & Steel	-2.7%	29.2%	-13	-13
TOL	02/17/06	19.0%	Toll Brothers, Inc.	Capital Goods	Construction Services	-1.2%	2.3%	-12	-12
MDC	01/20/06	4.3%	M.D.C. Holdings, Inc.	Capital Goods	Construction Services	-0.4%	14.0%	-7	-7

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
PGN	01/10/05	-2.9%	Progress Energy, Inc.	Utilities	Electric Utilities	-6.4%	-2.1%	-93	-93
WGL	12/23/05	-2.8%	WGL Holdings, Inc.	Utilities	Natural Gas Utilities	-5.8%	-1.2%	-91	-90
SRE	01/10/05	26.9%	Sempra Energy	Utilities	Natural Gas Utilities	-5.8%	-1.4%	-80	-80
UGI	12/30/05	3.2%	UGI Corporation	Utilities	Natural Gas Utilities	-5.9%	-1.4%	-82	-79
EON	03/10/06	-0.7%	E.ON AG (ADR)	Utilities	Electric Utilities	-5.2%	-0.7%	-76	-76
ATG	10/21/05	6.6%	AGL Resources Inc.	Utilities	Natural Gas Utilities	-3.0%	0.0%	-67	-67
ATO	04/01/05	-2.3%	Atmos Energy Corporation	Utilities	Natural Gas Utilities	-11.6%	-0.2%	-67	-67
CPK	05/06/05	17.5%	Chesapeake Utilities	Utilities	Natural Gas Utilities	-13.1%	1.1%	-52	-52
UU	06/10/05	1.2%	United Utilities PLC (ADR)	Utilities	Electric Utilities	-1.9%	1.7%	-36	-36
VVC	03/03/06	4.2%	Vectren Corporation	Utilities	Natural Gas Utilities	-1.7%	5.0%	-24	-24
KEP	01/10/05	87.7%	Korea Electric Power Corporation (ADR)	Utilities	Electric Utilities	0.0%	8.3%	-13	-13
OKE	11/11/05	23.2%	ONEOK, Inc.	Utilities	Natural Gas Utilities	-1.6%	13.3%	-12	-12

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
HHS	10/28/05	2.6%	Harte-Hanks, Inc.	Services	Printing & Publishing	-12.9%	-7.8%	-98	-98
CAKE	10/21/05	1.6%	The Cheesecake Factory Incorporated	Services	Restaurants	-9.4%	-2.7%	-94	-94
DGX	08/19/05	0.5%	Quest Diagnostics Incorporated	Health Care	Healthcare Facilities	-6.5%	-4.8%	-94	-94
JNJ	02/17/06	-2.1%	Johnson & Johnson	Health Care	Major Drugs	-5.2%	-2.3%	-90	-90
SNV	05/27/05	-7.3%	Synovus Financial Corp.	Financial	Regional Banks	-9.4%	-0.4%	-84	-81
CPS	05/27/05	9.5%	ChoicePoint Inc.	Services	Business Services	-5.2%	-2.1%	-72	-72
LOW	11/18/05	-0.8%	Lowe's Companies, Inc.	Services	Retail (Home Improvement)	-5.8%	0.0%	-69	-69
EWBC	12/30/05	2.0%	East West Bancorp, Inc.	Financial	Regional Banks	-5.8%	0.5%	-68	-68
CHD	11/18/05	6.7%	Church & Dwight Co., Inc.	Consumer Non-Cyclical	Personal & Household Products	-5.1%	-2.0%	-63	-63
GTRC	03/03/06	-2.4%	Guitar Center, Inc.	Services	Retail (Specialty Non-Apparel)	-2.4%	0.4%	-58	-55
ORLY	01/20/06	16.3%	O'Reilly Automotive, Inc.	Services	Retail (Specialty Non-Apparel)	-2.7%	1.4%	-64	-51
GISX