Wiser Trader Stocks and Options Newsletter

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Issue No. 76  May 17, 2006 Prescott, Arizona Systems@WiserTrader.com

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1.0 Trading

· The newsletter is on a mid-week schedule until some issues are worked out for a primary information source.  It will return to a Monday pre-open schedule soon, perhaps as early as next week.

· Five free Excel-XLQPlus spreadsheet downloads are available to help track various segments of the market at http://www.wisertrader.com/excel.php.  All have undergone recent updates. 

1.1 Pullback

      While climbing a wall of worry, the market decided to look down.  In part, it was declining consumer sentiment combined with Fed expectations of a slowing economy.  In addition was the recent rise in treasury yields following a quarter point Fed rate hike to 5.00%.  On Monday, it was a decline in the US dollar when Japan announced it would not hike interest rates at this time.  The market is shown in Figure 1A as of Monday’s close.

FIGURE 1A

© 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. 

      The Williams %R for each of the five indices is oversold.  On Thursday the 5-index Williams %R, shown in Figure 1B moved downward across the -50 neutral line and proceeded on Friday to narrow its range of component values.  At Monday’s close, the average indicator value was -92 with a range of 30 units.  The 200-day SMA for the indicator is -42. 

FIGURE 1B

1.2 Errata - Directivity

       In haste to publish the supplemental issue last Wednesday May 10, 2006, a couple of algebraic signs were misplaced in the directivity formula.  The formula should read,

      This corrected version has been incorporated into the archived newsletter dated 05-10-06 and in the spreadsheet download named Market Momentum. 

2.0 Market Analysis

      Commodities led the market lower on Monday, spurred by a rise in the US dollar after the Japanese central bank announced that it would not raise interest rates.  The average industry loss was -0.4% with 44% of 212 industries gaining.  This performance was better than Thursday and Friday of last week when the average industry loss was, respectively -1.3 and -1.4% with only 4 and 6% of industries gaining. 

      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	3.2%	-1.3%	2.1%	0.1%	2.4%
NASDAQ Composite Index	-3.1%	-4.5%	1.7%	-1.2%	1.0%
S & P 500 Index	0.7%	-2.3%	1.5%	-0.2%	1.8%
NYSE Composite Index	1.7%	-2.8%	1.9%	0.3%	2.4%
Russell 2000 Index	-1.6%	-5.6%	2.7%	-0.7%	2.2%
HGX, Phil. Housing Index	-7.9%	-5.1%	0.4%	-3.9%	0.5%
IYR, Real Estate	2.2%	-2.3%	2.6%	-1.4%	3.4%
GLD, GOLD	10.3%	-0.2%	3.7%	5.7%	0.9%
RKH, Banking	4.3%	-1.4%	0.6%	2.9%	2.2%
IYT, Transportation	5.9%	-2.0%	6.3%	-1.7%	3.4%
SMH, Semiconductors	-1.2%	-6.1%	2.3%	0.0%	2.8%
BBH, Biotechnology	-6.2%	-0.2%	2.0%	-5.8%	-2.2%
OIH, Oil Infrastructure	-0.4%	-7.1%	2.3%	0.9%	4.0%
XLE, Energy	-2.3%	-5.2%	0.9%	-1.3%	3.5%
XLU, Utilities	4.1%	-1.5%	2.9%	-1.6%	4.4%
XLB, Materials	0.3%	-4.1%	3.1%	-1.6%	3.1%
XLI, Industrial	3.7%	-2.0%	3.0%	-1.1%	3.9%
XLK, Technology	-3.9%	-4.3%	1.3%	-1.6%	0.8%
XLV, Healthcare	-0.1%	0.2%	0.2%	-1.0%	0.6%
XLF, Financials	3.0%	-1.7%	1.8%	0.9%	2.1%
XLP, Consumer Staples	3.5%	-1.1%	1.6%	1.3%	1.7%
XLY, Consumer Discretionary	2.2%	-1.4%	2.2%	0.7%	0.7%

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

Table 2B

Volatility

Indicator	Current	Last Week	2 Weeks Ago	Complacent	Cautious
VIX **	13.6	11.8	11.6	< 20	> 50
VXN ***	18.0	14.9	15.5	< 30	> 70
**   Above 20 day SMA = Short-term sell signal. *** Above 20 day SMA = Short-term sell signal.

      Figure 2A compares the major averages with key ETF’s and Sector SPDR’s.

FIGURE 2A

Table 2C

Market Summary

 
Industries are listed according to the Dow Jones Classification System 

 Major Indices 
 For the Past Week:
 Dow Jones      -1.3%
 NASDAQ         -4.5%
 S&P500 Index   -2.3%
 Russell 2000   -5.6%
 NYSE           -2.8%
 
 30 Year Bond 5.298%
 10 Year Note 5.186%
 
 Leading Industries
 For the Past Week:
 Automobiles 
 Aerospace & Defense 
 Nonferrous Metals 
 Broadcasting & Entertainment 
 Media 
 Heavy Construction 
 Automobiles & Parts 
 Personal Products 
 Media Agencies 
 Soft Drinks                     
 
 Lagging Industries
 For the Past Week:
 Paper 
 Travel & Tourism 
 Telecommunications Equipt 
 Home Construction 
 Platinum & Precious Metals 
 Technology Hardware & Equipt 
 Forestry & Paper 
 Semiconductors 
 Computer Hardware 
 Investment Services                
 
 Leading Industries
 For the Past Month:
 Coal 
 Mining 
 Transportation Services 
 Nonferrous Metals 
 Business Training & Employ 
 Hotels 
 Brewers 
 Basic Resources 
 Steel 
 Oil Equipment & Services             
 
 Lagging Industries
 For the Past Month:
 Water 
 Home Construction 
 Toys 
 Leisure Goods 
 Specialized Consumer Services 
 Software 
 Health Care Providers 
 Recreational Products 
 Software & Computer Services 
 Consumer Electronics                            
 
 Crude Oil $68.73
 
 Gold for the past 30 days:
 USD    +14.03%
 CAD    +10.33%
 CHF    + 6.45%
 GBP    + 6.29%
 EUR    + 7.98%
JPY     + 5.97%

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 Monday	1 Month	1 Week Ago	2 weeks Ago	3 Weeks Ago	4 Weeks Ago
Net Insider Buying	5.6%	-0.6%	4.8%	0.9%	0.3%	-1.9%	5.9%
Cash Rich Companies	5.3%	-0.5%	7.9%	2.0%	4.6%	0.5%	0.6%
Price to Free Cash Flow	6.5%	-0.2%	1.3%	-5.0%	0.8%	4.1%	1.7%
Growth Momentum	13.1%	-2.3%	0.4%	-6.0%	5.3%	-1.5%	3.1%
Lynch	21.9%	-1.7%	2.4%	-5.2%	2.7%	1.4%	3.9%
Buffett	23.3%	-1.1%	1.3%	-5.1%	3.2%	0.6%	2.9%
Graham	11.8%	-0.5%	0.6%	-3.9%	1.8%	0.1%	2.7%
Templeton	5.1%	0.2%	1.0%	-1.5%	1.9%	-0.5%	1.0%
Zweig	3.0%	-1.8%	-0.8%	-4.8%	3.5%	-2.0%	2.7%
Average	10.6%	-1.0%	2.1%	-3.2%	2.7%	0.1%	2.7%

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
CWEI	05/12/06	0.0%	Clayton Williams Energy, Inc.	Energy	Oil & Gas Operations	-1.3%	0.8%	-49	-90
EQS	04/13/06	0.0%	Equus II Incorporated	Financial	Investment Services	-5.1%	-4.1%	-71	-77
LXU	12/23/05	30.7%	LSB Industries, Inc.	Basic Materials	Chemical Manufacturing	-7.8%	2.7%	-25	-44
SOMX	05/12/06	1.5%	Somaxon Pharmaceuticals, Inc.	Health Care	Biotechnology & Drugs	1.5%	14.7%	-26	-29
NAHC	05/12/06	1.5%	National Atlantic Holdings Corporation	Financial	Insurance (Property & Casualty)	1.5%	0.5%	-28	-28
ACME	05/12/06	0.0%	ACME Communications, Inc.	Services	Broadcasting & Cable TV	0.0%	5.7%	-67	-24

      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
SCIX	04/07/06	10.0%	Scailex Corp., Ltd. (USA)	Technology	Computer Networks	-1.3%	10.2%	-12	-12
ACTS	05/05/06	3.8%	Actions Semiconductor Co., Ltd. (ADR)	Technology	Semiconductors	-1.7%	9.4%	-15	-10
WSC	03/11/06	2.1%	Wesco Financial Corporation	Conglomerates	Conglomerates	0.2%	4.1%	-17	-4

      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
FIS	05/12/06	0.4%	Fidelity National Information Services	Services	Business Services	0.4%	-2.7%	-85	-84
RKT	05/12/06	-0.8%	Rock-Tenn Company	Basic Materials	Paper & Paper Products	-0.8%	3.0%	-45	-65
KWD	03/04/06	20.0%	Kellwood Company	Consumer Cyclical	Apparel/Accessories	-5.4%	3.5%	-58	-60

      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
CAE	04/21/06	-3.3%	Cascade Corporation	Capital Goods	Misc. Capital Goods	-6.1%	-0.9%	-87	-87
TM	12/13/04	50.4%	Toyota Motor Corporation (ADR)	Consumer Cyclical	Auto & Truck Manufacturers	-8.6%	0.1%	-89	-84
KOF	04/29/05	44.0%	Coca-Cola FEMSA, S.A. (ADR)	Consumer Non-Cyclical	Beverages (Non-Alcoholic)	-4.6%	2.0%	-61	-68
RIO	05/05/06	-8.0%	Companhia Vale do Rio Doce (ADR)	Basic Materials	Metal Mining	-11.5%	-8.8%	-39	-59
PKX	02/17/06	21.9%	POSCO (ADR)	Basic Materials	Iron & Steel	-8.9%	-8.1%	-30	-57
AZN	02/03/06	14.6%	AstraZeneca PLC (ADR)	Health Care	Major Drugs	-3.7%	4.0%	-42	-46
SKM	02/07/05	29.8%	SK Telecom Co., Ltd. (ADR)	Services	Communications Services	-5.5%	7.3%	-18	-36
BTI	08/12/05	25.9%	British American Tobacco (ADR)	Consumer Non-Cyclical	Tobacco	-2.9%	3.6%	-24	-35

      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
APC	02/10/06	0.0%	Anadarko Petroleum Corporation	Energy	Oil & Gas Operations	-11.2%	-6.9%	-92	-100
GS	04/21/06	-7.7%	Goldman Sachs Group, Inc.	Financial	Investment Services	-7.7%	-5.4%	-100	-100
HCC	10/21/05	16.5%	HCC Insurance Holdings, Inc.	Financial	Insurance (Property & Casualty)	-9.0%	-3.4%	-100	-100
COG	05/12/06	-3.6%	Cabot Oil & Gas Corporation	Energy	Oil & Gas Operations	-3.6%	-5.1%	-71	-93
CHB	02/17/06	-5.4%	Champion Enterprises, Inc.	Capital Goods	Construction Services	-11.3%	-2.7%	-85	-92
BEN	11/04/05	-2.6%	Franklin Resources, Inc.	Financial	Investment Services	-14.3%	-6.0%	-82	-87
WCC	02/10/06	30.0%	WESCO International, Inc.	Technology	Electronic Instruments & Controls	-12.5%	-1.9%	-72	-81
CHE	05/06/05	41.6%	Chemed Corporation	Services	Business Services	-10.3%	-6.5%	-62	-80
ENDP	02/17/06	3.5%	Endo Pharmaceuticals	Health Care	Biotechnology & Drugs	-7.7%	-2.7%	-59	-75
ET	10/21/05	38.0%	E*TRADE FINANCIAL Corporation	Financial	Investment Services	-10.5%	-4.0%	-67	-72
OVTI	03/17/06	13.0%	OmniVision Technologies	Technology	Semiconductors	-11.8%	1.0%	-68	-70
BHP	09/09/05	42.0%	BHP Billiton Limited (ADR)	Basic Materials	Metal Mining	-9.0%	0.6%	-33	-68
PCU	12/02/05	42.0%	Southern Copper Corporation (USA)	Basic Materials	Metal Mining	-10.0%	0.8%	-39	-65
JEF	04/21/06	-4.8%	Jefferies Group, Inc.	Financial	Investment Services	-7.8%	1.1%	-42	-63
RIO	03/31/06	6.1%	Companhia Vale do Rio Doce (ADR)	Basic Materials	Metal Mining	-11.5%	5.9%	-39	-59
GRMN	03/03/06	24.6%	Garmin Ltd.	Technology	Communications Equipment	-5.6%	7.3%	-33	-45
MDR	05/12/06	-4.3%	McDermott International	Capital Goods	Construction Services	-4.3%	13.7%	-24	-43
KCS	05/12/06	-2.5%	KCS Energy, Inc.	Energy	Oil & Gas Operations	-2.5%	8.5%	-29	-41
SYT	04/08/05	37.4%	Syngenta AG (ADR)	Basic Materials	Chemical Manufacturing	-4.6%	4.3%	-31	-40
CSR	05/12/06	-1.3%	Credit Suisse Group (ADR)	Financial	Insurance (Life)	-1.3%	8.7%	-23	-33

      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
XEC	05/05/06	-7.2%	Cimarex Energy Co.	Energy	Oil & Gas Operations	-7.6%	-7.2%	-98	-100
ASH	10/28/05	19.7%	Ashland Inc.	Capital Goods	Construction Services	-14.1%	-11.4%	-89	-94
MVK	04/28/06	-2.6%	Maverick Tube Corporation	Capital Goods	Construction - Supplies and Fixtures	-9.3%	-6.2%	-80	-93
AH	02/03/06	16.1%	Armor Holdings, Inc.	Capital Goods	Aerospace and Defense	-9.2%	-3.9%	-95	-92
THO	04/15/05	84.0%	Thor Industries, Inc.	Capital Goods	Mobile Homes & RVs	-11.4%	-7.5%	-89	-91
RS	04/15/05	128.4%	Reliance Steel & Aluminum	Basic Materials	Misc. Fabricated Products	-10.1%	-6.3%	-60	-84
RI	09/02/05	31.7%	Ruby Tuesday, Inc.	Services	Restaurants	-11.4%	-8.2%	-100	-82
MBT	05/05/06	-4.6%	Mobile TeleSystems OJSC (ADR)	Services	Communications Services	-6.5%	-2.1%	-43	-81
SCHN	02/10/06	22.1%	Schnitzer Steel Industries, Inc.	Basic Materials	Iron & Steel	-12.7%	-2.0%	-63	-76
APA	05/12/06	-2.0%	Apache Corporation	Energy	Oil & Gas Operations	-2.0%	-2.1%	-33	-75
NKE	09/23/05	0.5%	NIKE, Inc.	Consumer Cyclical	Footwear	-10.7%	-0.2%	-77	-74
HDI	10/14/05	2.1%	Harley-Davidson, Inc.	Consumer Cyclical	Recreational Products	-9.9%	-1.1%	-88	-73
OXY	03/03/06	4.4%	Occidental Petroleum Corporation	Energy	Oil & Gas Operations	-7.4%	-2.1%	-41	-68
NUE	04/15/05	126.8%	Nucor Corporation	Basic Materials	Iron & Steel	-7.2%	-1.6%	-61	-66
NAT	05/12/06	-3.0%	Nordic American Tanker Shipping Limited	Transportation	Water Transportation	-3.0%	8.7%	-49	-66
PCU	02/10/06	14.7%	Southern Copper Corporation (USA)	Basic Materials	Metal Mining	-10.0%	0.8%	-39	-65
PSUN	05/05/06	-7.8%	Pacific Sunwear of CA	Services	Retail (Apparel)	-8.9%	1.3%	-29	-63
RIO	05/05/06	-8.0%	Companhia Vale do Rio Doce (ADR)	Basic Materials	Metal Mining	-11.5%	5.9%	-39	-59
UNT	03/03/06	6.9%	Unit Corporation	Energy	Oil & Gas Operations	-6.0%	-4.7%	-37	-53
MTH	05/12/06	-0.6%	Meritage Homes Corporation	Capital Goods	Construction Services	-0.6%	3.0%	-42	-52
STLD	12/16/05	85.1%	Steel Dynamics, Inc.	Basic Materials	Iron & Steel	-7.7%	8.2%	-44	-45
CCRT	12/30/05	3.4%	CompuCredit Corporation	Financial	Consumer Financial Services	-5.5%	8.5%	-35	-43
ANF	03/03/06	2.8%	Abercrombie & Fitch Co.	Services	Retail (Apparel)	-5.6%	6.6%	-38	-39
BTI	12/30/05	12.6%	British American Tobacco (ADR)	Consumer Non-Cyclical	Tobacco	-2.9%	3.6%	-24	-35
ABFS	04/29/05	38.2%	Arkansas Best Corporation	Transportation	Trucking	-4.6%	11.5%	-38	-35
FNF	10/21/05	12.9%	Fidelity National Financial	Financial	Insurance (Property & Casualty)	-5.1%	16.8%	-31	-34
RCII	10/21/05	68.3%	Rent-A-Center, Inc	Services	Rental & Leasing	-3.5%	2.9%	-36	-32
AEOS	03/10/06	12.7%	American Eagle Outfitters	Services	Retail (Apparel)	-2.4%	9.9%	-35	-26
JBHT	03/31/06	17.5%	J.B. Hunt Transport Services, Inc.	Transportation	Trucking	-2.1%	10.6%	-19	-12

      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
KEP	01/10/05	71.1%	Korea Electric Power Corporation (ADR)	Utilities	Electric Utilities	-14.2%	-7.4%	-97	-100
WGL	12/23/05	-6.7%	WGL Holdings, Inc.	Utilities	Natural Gas Utilities	-9.5%	-2.2%	-100	-100
PGN	01/10/05	-5.7%	Progress Energy, Inc.	Utilities	Electric Utilities	-9.2%	-0.4%	-98	-97
OKE	11/11/05	18.4%	ONEOK, Inc.	Utilities	Natural Gas Utilities	-5.5%	-1.9%	-91	-91
VVC	03/03/06	0.9%	Vectren Corporation	Utilities	Natural Gas Utilities	-4.7%	-1.1%	-76	-86
SRE	01/10/05	24.3%	Sempra Energy	Utilities	Natural Gas Utilities	-7.8%	0.5%	-98	-79
EON	03/10/06	4.4%	E.ON AG (ADR)	Utilities	Electric Utilities	-6.2%	3.5%	-54	-59
ATO	04/01/05	-0.3%	Atmos Energy Corporation	Utilities	Natural Gas Utilities	-9.8%	2.1%	-41	-54
ATG	10/21/05	7.5%	AGL Resources Inc.	Utilities	Natural Gas Utilities	-2.2%	1.6%	-49	-43
UU	06/10/05	2.1%	United Utilities PLC (ADR)	Utilities	Electric Utilities	-2.6%	1.9%	-38	-42
UGI	12/30/05	13.3%	UGI Corporation	Utilities	Natural Gas Utilities	-1.4%	9.6%	-22	-19

      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
SPF	05/12/06	-1.4%	Standard Pacific Corp.	Capital Goods	Construction Services	-1.4%	-9.1%	-87	-94
FLIR	04/28/06	-2.9%	FLIR Systems, Inc.	Capital Goods	Aerospace and Defense	-5.4%	-20.2%	-93	-94
GBCI	05/05/06	-4.2%	Glacier Bancorp, Inc.	Financial	Regional Banks	-4.2%	-1.9%	-99	-93
COH	04/13/06	-8.5%	Coach, Inc.	Consumer Cyclical	Apparel/Accessories	-13.0%	-9.7%	-91	-91
BBBY	04/07/06	-6.9%	Bed Bath & Beyond Inc.	Services	Retail (Specialty Non-Apparel)	-6.9%	-1.9%	-75	-82
ORLY	01/20/06	6.8%	O'Reilly Automotive, Inc.	Services	Retail (Specialty Non-Apparel)	-10.6%	-5.3%	-75	-82
LOW	11/18/05	-4.1%	Lowe's Companies, Inc.	Services	Retail (Home Improvement)	-8.9%	-0.4%	-75	-75
HDI	02/24/06	-4.3%	Harley-Davidson, Inc.	Consumer Cyclical	Recreational Products	-5.8%	0.0%	-88	-73
PCU	02/10/06	14.7%	Southern Copper Corporation (USA)	Basic Materials	Metal Mining	-10.0%	0.8%	-39	-65
AMSG	10/14/05	5.5%	AmSurg Corp.	Health Care	Healthcare Facilities	-9.8%	1.2%	-57	-57
SNV	05/27/05	-6.0%	Synovus Financial Corp.	Financial	Regional Banks	-8.2%	1.4%	-74	-54
CHD	11/18/05	10.4%	Church & Dwight Co., Inc.	Consumer Non-Cyclical	Personal & Household Products	-2.8%	2.5%	-51	-50
EWBC	12/30/05	8.1%	East West Bancorp, Inc.	Financial	Regional Banks	-3.5%	6.6%	-48	-46
WSM	09/02/05	13.3%	Williams-Sonoma, Inc.	Services	Retail (Specialty Non-Apparel)	-4.7%	3.1%	-49	-43
HHS	10/28/05	7.7%	Harte-Hanks, Inc.	Services	Printing & Publishing	-8.6%	0.3%	-44	-34
GTRC	03/03/06	5.2%	Guitar Center, Inc.	Services	Retail (Specialty Non-Apparel)	-3.8%	7.6%	-36	-34
GISX	12/30/05	14.2%	Global Imaging Systems, Inc.	Technology	Office Equipment	-2.8%	7.9%	-21	-28
MIK	12/30/05	9.1%	Michaels Stores, Inc.	Services	Retail (Specialty Non-Apparel)	-1.4%	4.4%	-33	-26
MMM	05/12/06	0.6%	3M Company	Conglomerates	Conglomerates	0.6%	8.5%	-15	-11
CPS	05/27/05	13.8%	ChoicePoint Inc.	Services	Business Services	-1.5%	3.6%	-22	-7
DGX	08/19/05	16.9%	Quest Diagnostics Incorporated	Health Care	Healthcare Facilities	0.1%	18.1%	-9	-4
EDMC	12/16/05	28.3%	Education Management Corp	Services	Schools	0.4%	3.2%	-18	-3
JNJ	02/17/06	1.5%	Johnson & Johnson	Health Care	Major Drugs	-1.7%	2.1%	-24	0

      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
MRO	04/28/06	-5.2%	Marathon Oil Corporation	Energy	Oil & Gas Operations	-8.4%	-8.6%	-79	-100
RDC	03/03/06	-2.2%	Rowan Companies, Inc.	Energy	Oil Well Services & Equipment	-14.1%	-8.7%	-95	-100
RRC	05/05/06	-4.9%	Range Resources Corp.	Energy	Oil & Gas Operations	-6.9%	-5.5%	-77	-100
XEC	04/13/06	-6.8%	Cimarex Energy Co.	Energy	Oil & Gas Operations	-12.9%	-9.3%	-98	-100
CHK	05/05/06	-6.4%	Chesapeake Energy Corporation	Energy	Oil & Gas Operations	-7.0%	-4.3%	-79	-100
COG	05/12/06	-3.6%	Cabot Oil & Gas Corporation	Energy	Oil & Gas Operations	-3.6%	-5.1%	-71	-93
ERF	05/05/06	-6.0%	ENERPLUS RESOURCES FUND SR G TR UNITS	Energy	Oil & Gas Operations	-7.1%	-2.5%	-32	-93
BEN	10/28/05	2.5%	Franklin Resources, Inc.	Financial	Investment Services	-14.3%	-6.0%	-82	-87
UCBH	04/13/06	-8.0%	UCBH Holdings, Inc.	Financial	Regional Banks	-10.3%	-8.4%	-89	-86