______________________________________________________________________________
Issue No. 37 – August 1, 2005
Prescott, Arizona Systems@WiserTrader.com
______________________________________________________________________________
1.0
Trading
Trading systems
involve controlling a few variables and letting the rest happen naturally.
1.1 System Controls
There are at least two
levels of money management. In the first, trailing stops are used with a
maximum percentage of capital per trade to limit draw-downs to less than 1 or
2% of investment capital. Fortunately, when one uses a consistent trading
system, a more precise relationship exists for choosing the correct stop loss
setting FL based on the average profit per trade FP, the
percentage of times that correct choices are made in the direction of trade FC
and the average fractional gain per winning trade FG. To maintain the
targeted value of FP, the stop loss setting magnitude must be less
than or equal to FL = (FP - FC FG)
/ (1 – FC). All quantities are decimal fractions with FL
being negative.
For the options advisory, an
average profit per trade of FP = 0.14 is the goal. There is little
control over FG because it is determined by market conditions.
There is some degree of control over the fraction of trades chosen in the
correct direction FC but this fraction is a function of experience.
It remains stable as long as the system is followed and it can not be changed
at will. The area where the most control lies is in FL, the stop
loss setting. The way this works is by monitoring FG for a
historical value of FC and a targeted goal of FP, the
proper stop loss setting FL becomes apparent from the above
relationship.
FG should be
monitored over a period long enough to provide a statistically significant
sample of trades. When equal sized trades are made, the number of trades
needed to earn an amount equal to the average trade size is 1/FP. Although
the average size of trades is selected independently of the trailing stop
percentage, it is a good idea to play it safe and limit the maximum trade size
to 10 or 20% of your risk capital. This assumes that your risk capital is no
more than 10% of your total investment capital. When a trading system is used
consistently, this model enables precise money management. A full derivation
of the model can be found at http://www.wisertrader.com/precisionmoneymgmt.php
.
© 2005 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.
2.0
Market Analysis
The markets are filled with
optimism backed by strong earnings and economic reports. About 70% of
companies reported higher than expected earnings compared with a historical
62%. Second quarter GDP was 3.4%, surpassing the long-term historical average
of 3.1%. Market strength is broad based. The top performing industries were
tire & rubber, wireless services, and construction and engineering. Poorly
performing industries included home electronics, computer storage companies,
thrift banks, and home furnishings.
Industry leaders in Table 2A
rank from highest to lowest. Relative strength is given in Table 2B and VTO
market sentiment in Table 2C.
Table 2B
Relative Strength Index
|
|
5 Day RSI
|
|
DOW
|
Neutral
|
|
S&P
500
|
Neutral
|
|
NASDAQ
|
Neutral
|
Table 2C
VTO Market Sentiment Indicators
|
Sentiment Indicator
|
Value
|
Last Week
|
2 Weeks Ago
|
Complacent
|
Cautious
|
|
VIX **
|
11.57
|
10.52
|
10.33
|
< 20
|
> 50
|
|
VXN ***
|
13.87
|
12.95
|
13.34
|
< 30
|
> 70
|
|
Put/Call Ratio
|
0.560
|
0.561
|
0.540
|
< 0.6
|
> 0.7
|
|
%Bulls - %Bears
|
33.3%
|
29.5%
|
32.3%
|
> 29%
|
< 20%
|
|
** Below 20 day SMA = Buy signal.
***
Below 20 day SMA = Buy signal.
|
In Table 2D, the broader
market was mixed for the week.
Table 2D
Index Tracking Stocks, Key
Industry ETF’s and Sector SPDR’s
|
|
1 month
|
1 wk ago
|
2 wks ago
|
3 wks ago
|
4 wks ago
|
|
SPY (S&P 500)
|
3.5%
|
0.2%
|
0.6%
|
1.3%
|
1.5%
|
|
DIA (DOW)
|
3.4%
|
0.1%
|
0.2%
|
1.7%
|
1.4%
|
|
QQQQ (NASDAQ 100)
|
7.7%
|
0.4%
|
1.4%
|
3.0%
|
2.8%
|
|
IWM (Russell 2000)
|
6.1%
|
0.8%
|
2.0%
|
0.0%
|
3.1%
|
|
GLD, GOLD
|
0.3%
|
0.9%
|
1.0%
|
-0.5%
|
-1.0%
|
|
RKH, Banking
|
2.2%
|
-0.9%
|
-0.8%
|
3.1%
|
0.8%
|
|
IYT, Transportation
|
8.2%
|
0.5%
|
3.4%
|
1.9%
|
2.2%
|
|
SMH, Semiconductors
|
10.6%
|
0.4%
|
0.6%
|
4.1%
|
5.1%
|
|
BBH, Biotechnology
|
13.9%
|
1.1%
|
2.0%
|
4.8%
|
5.5%
|
|
IYR, Real Estate
|
5.7%
|
2.4%
|
1.4%
|
-0.7%
|
2.5%
|
|
OIH, Oil
|
9.9%
|
1.5%
|
8.8%
|
-1.7%
|
1.2%
|
|
XLE,
Energy
|
4.8%
|
0.4%
|
4.5%
|
-1.9%
|
1.8%
|
|
XLU,
Utilities
|
1.3%
|
1.5%
|
-0.7%
|
0.1%
|
0.4%
|
|
XLB,
Materials
|
5.6%
|
-0.5%
|
3.1%
|
0.8%
|
2.1%
|
|
XLI,
Industrial
|
3.5%
|
0.0%
|
1.6%
|
0.7%
|
1.2%
|
|
XLK,
Technology
|
5.4%
|
0.4%
|
-0.3%
|
2.8%
|
2.4%
|
|
XLV,
Healthcare
|
2.4%
|
1.1%
|
-0.3%
|
0.8%
|
0.9%
|
|
XLF,
Financials
|
1.5%
|
-0.7%
|
-0.7%
|
1.6%
|
1.3%
|
|
XLP,
Consumer Staples
|
2.8%
|
0.9%
|
-0.3%
|
1.6%
|
0.7%
|
|
XLY,
Consumer Discretionary
|
5.4%
|
0.2%
|
1.3%
|
1.9%
|
1.9%
|
Key industry ETF’s 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 Real Estate
are respective indicators for the inverse health of the currency and the
economy in general.
Figure 1 compares index
tracking stocks for the major averages with Sector SPDR’s.
Figure 2 compares index
tracking stocks with five leading ETF’s for the week.
FIGURE 1
FIGURE 2
3.0 Procedure
The following watch lists contain
stock candidates for consideration. They are not necessarily trades. The “Reference”
is the date that a stock passed the indicated filter and was 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. 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. More information on filters
is available on the web site. Send an email
if you need more details.
Key
Companies that have
experienced net insider buying within the past 6 months of 5% or more of issued
stock are listed in Table 3A. These stocks should also appear in one of the master
trader screens or meet additional screening criteria before being given serious
consideration. FVRL was removed because it decline more than 15% from its
highest price after being listed.
Table 3A
Net Insider Buying Check List
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
|
ACAD
|
04/29/05
|
28.0%
|
ACADIA
Pharmaceuticals Inc.
|
Health
Care
|
Biotechnology
& Drugs
|
0.0%
|
|
AFT
|
05/20/05
|
-8.2%
|
Axesstel,
Inc.
|
Technology
|
Communications
Equipment
|
-11.8%
|
|
ASPV
|
05/27/05
|
11.2%
|
Aspreva
Pharmaceuticals Corporation
|
Health
Care
|
Biotechnology
& Drugs
|
-4.9%
|
|
ATPL
|
07/01/05
|
4.6%
|
Atlantis
Plastics, Inc.
|
Basic
Materials
|
Fabricated
Plastic & Rubber
|
-6.0%
|
|
AUXL
|
07/15/05
|
7.9%
|
Auxilium
Pharmaceuticals, Inc.
|
Health
Care
|
Biotechnology
& Drugs
|
-1.7%
|
|
CRTX
|
07/01/05
|
-9.9%
|
Critical
Therapeutics, Inc.
|
Health
Care
|
Biotechnology
& Drugs
|
-13.0%
|
|
CRYO
|
07/29/05
|
0.0%
|
CryoCor,
Inc.
|
Health
Care
|
Medical
Equipment & Supplies
|
0.0%
|
|
FTD
|
04/08/05
|
-3.0%
|
FTD Group,
Inc.
|
Services
|
Retail
(Catalog & Mail Order)
|
-3.1%
|
|
HEM
|
07/29/05
|
0.0%
|
Hemosense,
Inc.
|
Health
Care
|
Medical
Equipment & Supplies
|
0.0%
|
|
IRN
|
05/20/05
|
2.3%
|
Rewards
Network Inc.
|
Services
|
Business
Services
|
-2.0%
|
|
ITMN
|
04/08/05
|
37.5%
|
InterMune,
Inc.
|
Health
Care
|
Biotechnology
& Drugs
|
-6.0%
|
|
KIRK
|
05/27/05
|
-7.5%
|
Kirkland's, Inc.
|
Services
|
Retail
(Specialty Non-Apparel)
|
-11.7%
|
|
MERCS
|
05/20/05
|
-1.1%
|
Mercer
International Inc.
|
Basic
Materials
|
Paper
& Paper Products
|
-1.1%
|
|
PCTY
|
07/08/05
|
8.7%
|
Party City
Corporation
|
Services
|
Retail
(Specialty Non-Apparel)
|
0.0%
|
|
RGN
|
07/01/05
|
14.5%
|
RegeneRx
Biopharmaceut.
|
Health
Care
|
Biotechnology
& Drugs
|
0.0%
|
|
RNAI
|
07/15/05
|
55.1%
|
Sirna
Therapeutics, Inc.
|
Health
Care
|
Biotechnology
& Drugs
|
-9.6%
|
|
SCLN
|
07/01/05
|
55.2%
|
SciClone
Pharmaceuticals
|
Health
Care
|
Biotechnology
& Drugs
|
0.0%
|
|
SLXA
|
07/29/05
|
0.0%
|
Solexa,
Inc.
|
Health
Care
|
Biotechnology
& Drugs
|
0.0%
|
|
SSAG
|
07/29/05
|
0.0%
|
SSA Global
Technologies, Inc.
|
Technology
|
Software
& Programming
|
0.0%
|
|
STLW
|
07/08/05
|
0.0%
|
Stratos
International, Inc.
|
Technology
|
Semiconductors
|
-1.9%
|
|
THLD
|
07/08/05
|
20.3%
|
Threshold
Pharmaceuticals, Inc.
|
Health
Care
|
Biotechnology
& Drugs
|
-5.1%
|
|
ZHNE
|
07/15/05
|
12.3%
|
Zhone
Technologies, Inc.
|
Technology
|
Communications
Equipment
|
-5.2%
|
Companies with net cash
positions that comprise at least 40% of their share price 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. CDCO
was removed because of its Over the Counter status making it difficult to
update the data. Its price performance is still in line with requirements for
being listed here. EXM declined more than 15% from its highest price after
being listed and was removed.
Table 3B - Capital Rich Companies Check
List
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
|
CDCO
|
07/15/05
|
-2.1%
|
COMDISCO
HLDG CO INC
|
Services
|
Rental
& Leasing
|
-2.1%
|
|
CLCT
|
05/20/05
|
-3.4%
|
Collectors
Universe, Inc.
|
Services
|
Business
Services
|
-9.4%
|
|
EXAR
|
07/22/05
|
-3.0%
|
Exar
Corporation
|
Technology
|
Semiconductors
|
-3.0%
|
|
EXM
|
07/15/05
|
-8.7%
|
Excel
Maritime Carriers
|
Transportation
|
Water
Transportation
|
-14.0%
|
|
HWG
|
06/03/05
|
7.9%
|
The
Hallwood Group Incorporated
|
Consumer
Cyclical
|
Textiles -
Non-Apparel
|
-10.9%
|
|
KEYN
|
05/13/05
|
28.8%
|
Keynote
Systems, Inc.
|
Technology
|
Computer
Services
|
-1.7%
|
|
TIWI
|
07/29/05
|
0.0%
|
Telesystem
International Wireless (USA)
|
Services
|
Communications
Services
|
0.0%
|
|
WSC
|
07/01/05
|
-1.8%
|
Wesco
Financial Corporation
|
Conglomerates
|
Conglomerates
|
-1.8%
|
|
WZEN
|
04/22/05
|
0.2%
|
Webzen
Inc. (ADR)
|
Technology
|
Computer
Services
|
-8.4%
|
For the screen in
Table 3C, the number of selections is reduced by eliminating stocks having
P/E’s greater than 30.
Table 3C - Growth Momentum Watch List
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
|
ADVNB
|
05/20/05
|
20.1%
|
Advanta
Corp.
|
Financial
|
Consumer
Financial Services
|
0.0%
|
|
BDK
|
04/29/05
|
8.0%
|
The Black
& Decker Corporation
|
Consumer
Cyc
|
Appliances
& Tools
|
-2.8%
|
|
CHE
|
05/06/05
|
10.8%
|
Chemed
Corporation
|
Services
|
Business
Services
|
-1.9%
|
|
CRAI
|
03/18/05
|
4.0%
|
CRA
International, Inc.
|
Services
|
Business
Services
|
-7.6%
|
|
EXP
|
07/29/05
|
0.0%
|
Eagle
Materials, Inc.
|
Capital
Goods
|
Construction
- Raw Materials
|
0.0%
|
|
HOV
|
06/17/05
|
6.7%
|
Hovnanian
Enterprises
|
Capital
Goods
|
Construction
Services
|
-3.4%
|
|
HW
|
07/29/05
|
0.0%
|
Headwaters
Incorporated
|
Energy
|
Coal
|
0.0%
|
|
KBH
|
06/17/05
|
6.0%
|
KB Home
|
Capital
Goods
|
Construction
Services
|
-3.0%
|
|
LEN
|
06/17/05
|
6.2%
|
Lennar
Corporation
|
Capital
Goods
|
Construction
Services
|
-1.5%
|
|
LEV
|
07/29/05
|
0.0%
|
Levitt
Corporation
|
Capital
Goods
|
Construction
Services
|
0.0%
|
|
NVR
|
07/22/05
|
6.3%
|
NVR, Inc.
|
Capital
Goods
|
Construction
Services
|
0.0%
|
|
ORCC
|
05/06/05
|
4.7%
|
Online
Resources Corp.
|
Technology
|
Computer
Services
|
-12.2%
|
|
OSK
|
03/12/05
|
7.5%
|
Oshkosh
Truck Corporation
|
Consumer
Cyc
|
Auto &
Truck Manufacturers
|
-1.2%
|
|
PNR
|
05/06/05
|
-2.6%
|
Pentair,
Inc.
|
Conglomerates
|
Conglomerates
|
-12.7%
|
|
PTRY
|
04/29/05
|
33.1%
|
The
Pantry, Inc.
|
Services
|
Retail
(Grocery)
|
-3.5%
|
|
RYL
|
07/22/05
|
-1.4%
|
The Ryland
Group, Inc.
|
Capital
Goods
|
Construction
Services
|
-1.9%
|
|
SAY
|
06/17/05
|
10.1%
|
Satyam
Computer (ADR)
|
Technology
|
Software
& Programming
|
-1.8%
|
|
SFY
|
04/22/05
|
44.5%
|
Swift
Energy Company
|
Energy
|
Oil &
Gas Operations
|
0.0%
|
|
SGK
|
05/13/05
|
14.2%
|
Schawk,
Inc.
|
Services
|
Printing
Services
|
-10.8%
|
|
SPF
|
05/06/05
|
25.7%
|
Standard
Pacific Corp.
|
Capital
Goods
|
Construction
Services
|
-3.1%
|
|
SYT
|
04/08/05
|
-2.7%
|
Syngenta
AG (ADR)
|
Basic
Materials
|
Chemical
Manufacturing
|
-4.0%
|
|
TDY
|
04/29/05
|
24.8%
|
Teledyne
Technologies Incorporated
|
Services
|
Business
Services
|
-1.0%
|
|
UNH
|
04/15/05
|
12.1%
|
UnitedHealth
Group Inc.
|
Financial
|
Insurance
(Accident & Health)
|
-2.2%
|
|
WOS
|
04/01/05
|
-1.2%
|
Wolseley
plc (ADR)
|
Capital
Goods
|
Misc.
Capital Goods
|
-4.3%
|
|
ZNT
|
04/15/05
|
29.1%
|
Zenith
National Insurance Corp.
|
Financial
|
Insurance
(Property & Casualty)
|
-1.5%
|
For the Peter Lynch screen
in Table 3D, the number of selections is reduced by eliminating stocks having
P/E’s greater than 30. SC was removed only because information was difficult
to retrieve.
Table 3D
Peter Lynch Value Watch List
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
|
ASH
|
07/29/05
|
0.0%
|
Ashland
Inc.
|
Capital
Goods
|
Construction
Services
|
0.0%
|
|
CAJ
|
01/31/05
|
-6.5%
|
Canon Inc.
(ADR)
|
Technology
|
Computer
Peripherals
|
-11.2%
|
|
CHL
|
03/18/05
|
19.3%
|
China Mobile (Hong Kong) Limited (ADR)
|
Services
|
Communications
Services
|
-0.5%
|
|
EDUC
|
07/15/05
|
0.4%
|
Educational
Development
|
Services
|
Printing
& Publishing
|
-1.0%
|
|
GMK
|
05/06/05
|
22.6%
|
Gruma S.A.
de C.V. (ADR)
|
Consumer
Non-Cyclical
|
Food
Processing
|
-1.5%
|
|
KEP
|
12/13/04
|
30.1%
|
Korea
Electric Power Corporation (ADR)
|
Utilities
|
Electric
Utilities
|
-1.9%
|
|
KOF
|
04/29/05
|
24.9%
|
Coca-Cola
FEMSA, S.A. (ADR)
|
Consumer
Non-Cyclical
|
Beverages
(Non-Alcoholic)
|
-0.3%
|
|
LFL
|
05/13/05
|
4.5%
|
Lan
Airlines S.A. (ADR)
|
Transportation
|
Airline
|
-3.3%
|
|
MKTAY
|
04/15/05
|
20.7%
|
Makita
Corporation (ADR)
|
Consumer
Cyclical
|
Appliances
& Tools
|
-1.8%
|
|
NHY
|
04/29/05
|
20.8%
|
Norsk
Hydro ASA (ADR)
|
Conglomerates
|
Conglomerates
|
-3.9%
|
|
NL
|
07/22/05
|
0.1%
|
NL
Industries, Inc.
|
Basic
Materials
|
Chemical
Manufacturing
|
-2.0%
|
|
NTE
|
05/06/05
|
10.8%
|
Nam Tai
Electronics, Inc.
|
Technology
|
Electronic
Instruments & Controls
|
-2.7%
|
|
PKX
|
04/29/05
|
9.6%
|
POSCO
(ADR)
|
Basic
Materials
|
Iron &
Steel
|
0.0%
|
|
RD
|
04/29/05
|
5.3%
|
Royal
Dutch Petroleum Co.
|
Services
|
Printing
& Publishing
|
-8.5%
|
|
SAB
|
05/13/05
|
1.2%
|
Grupo Casa
Saba, S.A. (ADR)
|
Consumer
Non-Cyclical
|
Personal
& Household Products
|
-0.8%
|
|
SHI
|
06/03/05
|
7.6%
|
Sinopec
Shanghai Petrochemical Co. (ADR)
|
Energy
|
Oil &
Gas Operations
|
0.0%
|
|
SKM
|
02/07/05
|
6.5%
|
SK Telecom
Co., Ltd. (ADR)
|
Services
|
Communications
Services
|
-1.9%
|
|
TKS
|
04/15/05
|
-5.1%
|
Tomkins
plc (ADR)
|
Conglomerates
|
Conglomerates
|
-6.1%
|
|
TM
|
12/13/04
|
1.1%
|
Toyota Motor
Corporation (ADR)
|
Consumer
Cyclical
|
Auto &
Truck Manufacturers
|
-7.3%
|
|
TMX
|
06/03/05
|
4.2%
|
Telefonos
de Mexico, S.A. (ADR)
|
Services
|
Communications
Services
|
-3.6%
|
|
TP
|
05/27/05
|
-4.7%
|
TNT N.V.
(ADR)
|
Transportation
|
Trucking
|
-4.7%
|
|
VCP
|
05/06/05
|
-0.4%
|
Votorantim
Celulose e Papel S.A (ADR)
|
Basic
Materials
|
Forestry
& Wood Products
|
-2.9%
|
|
VLCCF
|
06/03/05
|
11.6%
|
Knightsbridge
Tankers Limited
|
Transportation
|
Water
Transportation
|
-1.5%
|
|
YPF
|
04/15/05
|
14.9%
|
YPF
Sociedad Anonima S.A. (ADR)
|
Energy
|
Oil &
Gas Operations
|
-0.9%
|
The filter for Warren
Buffet style stock picking in Table 3E 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 3E
Warren Buffett Value Watch List
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
|
ABFS
|
04/29/05
|
8.8%
|
Arkansas
Best Corporation
|
Transportation
|
Trucking
|
-5.6%
|
|
ACS
|
04/29/05
|
4.8%
|
Affiliated
Computer Services
|
Technology
|
Computer
Services
|
-5.4%
|
|
APPB
|
04/29/05
|
7.0%
|
Applebee's
Int'l, Inc.
|
Services
|
Restaurants
|
-6.3%
|
|
CACH
|
04/29/05
|
59.1%
|
Cache,
Inc.
|
Services
|
Retail
(Apparel)
|
-3.6%
|
|
DHI
|
04/15/05
|
52.7%
|
D.R.
Horton Inc.
|
Capital
Goods
|
Construction
Services
|
-2.4%
|
|
DSPG
|
02/07/05
|
-0.5%
|
DSP Group,
Inc.
|
Technology
|
Communications
Equipment
|
-6.3%
|
|
ELBO
|
01/31/05
|
84.3%
|
Electronics
Boutique Holdings Corp.
|
Services
|
Retail
(Technology)
|
-1.6%
|
|
FNF
|
07/29/05
|
0.0%
|
Fidelity
National Financial
|
Financial
|
Insurance
(Property & Casualty)
|
0.0%
|
|
FOSL
|
05/13/05
|
20.0%
|
Fossil,
Inc.
|
Consumer
Cyclical
|
Jewelry
& Silverware
|
-4.1%
|
|
HDI
|
04/15/05
|
16.1%
|
Harley-Davidson,
Inc.
|
Consumer
Cyclical
|
Recreational
Products
|
-1.5%
|
|
HELE
|
05/20/05
|
1.9%
|
Helen of
Troy Limited
|
Consumer
Cyclical
|
Appliances
& Tools
|
-9.8%
|
|
HOV
|
06/24/05
|
13.5%
|
Hovnanian
Enterprises
|
Capital
Goods
|
Construction
Services
|
-3.4%
|
|
LNCR
|
12/27/04
|
-4.1%
|
Lincare
Holdings Inc.
|
Health
Care
|
Healthcare
Facilities
|
-12.2%
|
|
LXK
|
04/29/05
|
-9.7%
|
Lexmark
International, Inc.
|
Technology
|
Computer
Peripherals
|
-11.0%
|
|
NUE
|
04/15/05
|
13.7%
|
Nucor
Corporation
|
Basic
Materials
|
Iron &
Steel
|
-1.3%
|
|
PGR
|
12/27/04
|
18.4%
|
The
Progressive Corp.
|
Financial
|
Insurance
(Property & Casualty)
|
-0.9%
|
|
RCII
|
07/29/05
|
0.0%
|
Rent-A-Center,
Inc
|
Services
|
Rental
& Leasing
|
0.0%
|
|
RI
|
07/15/05
|
-0.3%
|
Ruby
Tuesday, Inc.
|
Services
|
Restaurants
|
-0.3%
|
|
RS
|
04/15/05
|
21.7%
|
Reliance
Steel & Aluminum
|
Basic
Materials
|
Misc.
Fabricated Products
|
0.0%
|
|
SRT
|
05/06/05
|
33.2%
|
StarTek,
Inc.
|
Services
|
Business
Services
|
-3.3%
|
|
STLD
|
05/20/05
|
14.9%
|
Steel
Dynamics, Inc.
|
Basic
Materials
|
Iron &
Steel
|
-2.2%
|
|
THO
|
04/15/05
|
32.9%
|
Thor
Industries, Inc.
|
Capital
Goods
|
Mobile
Homes & RVs
|
-1.0%
|
|
TLK
|
04/29/05
|
28.4%
|
PT
Telekomunikasi Indonesia (ADR)
|
Services
|
Communications
Services
|
-2.2%
|
|
TSCO
|
04/22/05
|
36.5%
|
Tractor
Supply Company
|
Services
|
Retail
(Home Improvement)
|
-3.4%
|
Stocks from Benjamin
Graham’s style of utility investing are listed in Table 3F. A requirement was
added to include only those stocks having a PE of 17 or less.
Table 3F - Benjamin Graham Utility
Watch List
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
|
ATG
|
04/29/05
|
11.1%
|
AGL
Resources Inc.
|
Utilities
|
Natural
Gas Utilities
|
-1.7%
|
|
ATO
|
04/01/05
|
8.3%
|
Atmos
Energy Corporation
|
Utilities
|
Natural
Gas Utilities
|
-1.2%
|
|
CEG
|
04/29/05
|
14.6%
|
Constellation
Energy Group
|
Utilities
|
Electric
Utilities
|
-0.6%
|
|
CPK
|
05/06/05
|
18.5%
|
Chesapeake Utilities
|
Utilities
|
Natural
Gas Utilities
|
-1.0%
|
|
KEP
|
01/10/05
|
40.4%
|
Korea
Electric Power Corporation (ADR)
|
Utilities
|
Electric
Utilities
|
-1.9%
|
|
NFG
|
04/08/05
|
6.4%
|
National
Fuel Gas Co.
|
Utilities
|
Natural
Gas Utilities
|
0.0%
|
|
OKE
|
04/15/05
|
21.9%
|
ONEOK,
Inc.
|
Utilities
|
Natural
Gas Utilities
|
-0.1%
|
|
PGN
|
01/10/05
|
1.2%
|
Progress
Energy, Inc.
|
Utilities
|
Electric
Utilities
|
-2.5%
|
|
PNW
|
01/10/05
|
6.3%
|
Pinnacle
West Capital
|
Utilities
|
Electric
Utilities
|
0.0%
|
|
SJI
|
07/01/05
|
-4.6%
|
South
Jersey Industries
|
Utilities
|
Natural
Gas Utilities
|
-8.2%
|
|
SRE
|
01/10/05
|
17.6%
|
Sempra
Energy
|
Utilities
|
Natural
Gas Utilities
|
-0.3%
|
|
UU
|
06/10/05
|
-5.4%
|
United
Utilities PLC (ADR)
|
Utilities
|
Electric
Utilities
|
-6.1%
|
|
WPS
|
02/07/05
|
12.4%
|
WPS
Resources Corp
|
Utilities
|
Electric
Utilities
|
-0.4%
|
Sstocks from John Templeton’s style of investing are
listed in Table 3G.
Table 3G - John Templeton Watch
List
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
|
BBBY
|
06/24/05
|
11.3%
|
Bed Bath
& Beyond Inc.
|
Services
|
Retail
(Specialty Non-Apparel)
|
-2.0%
|
|
BRO
|
05/27/05
|
-2.5%
|
Brown
& Brown, Inc.
|
Financial
|
Insurance
(Miscellaneous)
|
-6.8%
|
|
CACH
|
05/27/05
|
35.2%
|
Cache,
Inc.
|
Services
|
Retail
(Apparel)
|
-3.6%
|
|
CPS
|
05/27/05
|
8.8%
|
ChoicePoint
Inc.
|
Services
|
Business
Services
|
-0.3%
|
|
DGX
|
05/27/05
|
-3.5%
|
Quest
Diagnostics Incorporated
|
Health
Care
|
Healthcare
Facilities
|
-4.4%
|
|
EASI
|
06/03/05
|
5.3%
|
Engineered
Support System
|
Capital
Goods
|
Misc.
Capital Goods
|
-0.4%
|
|
EDMC
|
06/03/05
|
6.9%
|
Education
Management Corp
|
Services
|
Schools
|
-2.1%
|
|
FCBP
|
05/27/05
|
14.7%
|
First
Community Banc./CA/
|
Financial
|
Regional
Banks
|
0.0%
|
|
HDI
|
05/27/05
|
6.6%
|
Harley-Davidson,
Inc.
|
Consumer
Cyclical
|
Recreational
Products
|
-1.5%
|
|
JNJ
|
05/27/05
|
-5.1%
|
Johnson
& Johnson
|
Health
Care
|
Major
Drugs
|
-5.1%
|
|
MBT
|
06/17/05
|
8.3%
|
Mobile
TeleSystems OJSC (ADR)
|
Services
|
Communications
Services
|
-3.1%
|
|
MTB
|
05/27/05
|
5.3%
|
M&T
Bank Corporation
|
Financial
|
Regional
Banks
|
-3.4%
|
|
NFB
|
07/29/05
|
0.0%
|
North Fork
Bancorporation, Inc.
|
Financial
|
Regional
Banks
|
0.0%
|
|
RLI
|
07/22/05
|
3.7%
|
RLI Corp.
|
Financial
|
Insurance
(Property & Casualty)
|
-0.7%
|
|
SFG
|
05/27/05
|
15.2%
|
StanCorp
Financial Group, Inc.
|
Financial
|
Insurance
(Life)
|
-2.9%
|
|
SNV
|
05/27/05
|
1.1%
|
Synovus
Financial Corp.
|
Financial
|
Regional
Banks
|
-1.3%
|
|
SQM
|
05/27/05
|
46.1%
|
Sociedad
Quimica y Minera (ADR)
|
Basic
Materials
|
Chemical
Manufacturing
|
-1.0%
|
|
SYY
|
05/27/05
|
-3.4%
|
SYSCO
Corporation
|
Services
|
Retail
(Grocery)
|
-4.6%
|
|
WMAR
|
05/27/05
|
22.2%
|
West
Marine, Inc.
|
Services
|
Retail
(Specialty Non-Apparel)
|
0.0%
|
|
WSM
|
05/27/05
|
13.1%
|
Williams-Sonoma,
Inc.
|
Services
|
Retail
(Specialty Non-Apparel)
|
-1.5%
|
Stocks from Martin Zweig’s
style of investing are listed in Table 3H.
Table 3H
Martin Zweig Watch List
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
|
ABNS
|
07/22/05
|
0.7%
|
ALLIANCE BANCSHS CALIF
|
Financial
|
Regional
Banks
|
0.0%
|
|
AMSG
|
07/29/05
|
0.0%
|
AmSurg
Corp.
|
Health
Care
|
Healthcare
Facilities
|
0.0%
|
|
APA
|
05/27/05
|
15.7%
|
Apache
Corporation
|
Energy
|
Oil &
Gas Operations
|
-3.3%
|
|
AQNT
|
05/27/05
|
28.0%
|
aQuantive
Inc.
|
Services
|
Advertising
|
-4.3%
|
|
BMHC
|
05/27/05
|
33.5%
|
Building
Materials Holding Corp.
|
Services
|
Retail
(Home Improvement)
|
-4.3%
|
|
BR
|
07/29/05
|
0.0%
|
Burlington
Resources Inc.
|
Energy
|
Oil &
Gas Operations
|
0.0%
|
|
BSIC
|
07/29/05
|
0.0%
|
BASIC
EARTH SCIENCE SYS
|
Energy
|
Oil &
Gas Operations
|
0.0%
|
|
CAE
|
06/10/05
|
6.6%
|
Cascade
Corporation
|
Capital
Goods
|
Misc.
Capital Goods
|
-2.7%
|
|
CLFC
|
05/27/05
|
20.0%
|
Center
Financial Corporation
|
Financial
|
Regional
Banks
|
-2.2%
|
|
CMTL
|
07/01/05
|
7.3%
|
Comtech
Telecomm. Corp.
|
Technology
|
Communications
Equipment
|
-1.4%
|
|
DHI
|
05/27/05
|
18.8%
|
D.R.
Horton Inc.
|
Capital
Goods
|
Construction
Services
|
-2.4%
|
|
EPL
|
05/27/05
|
15.7%
|
Energy
Partners, Ltd.
|
Energy
|
Oil &
Gas Operations
|
-4.8%
|
|
EXP
|
05/27/05
|
13.3%
|
Eagle
Materials, Inc.
|
Capital
Goods
|
Construction
- Raw Materials
|
-0.1%
|
|
FORD
|
06/24/05
|
46.6%
|
Forward
Industries, Inc.
|
Consumer
Cyclical
|
Apparel/Accessories
|
0.0%
|
|
FRGB
|
07/15/05
|
9.7%
|
First
Regional Bancorp
|
Financial
|
Regional
Banks
|
-1.8%
|
|
KBH
|
06/17/05
|
6.0%
|
KB Home
|
Capital
Goods
|
Construction
Services
|
-3.0%
|
|
LEN
|
05/27/05
|
16.9%
|
Lennar
Corporation
|
Capital
Goods
|
Construction
Services
|
-1.5%
|
|
MBWM
|
07/15/05
|
-2.4%
|
Mercantile
Bank Corp.
|
Financial
|
Regional
Banks
|
-5.5%
|
|
MCO
|
07/29/05
|
0.0%
|
Moody's
Corporation
|
Services
|
Business
Services
|
0.0%
|
|
MKL
|
05/27/05
|
-1.8%
|
Markel
Corporation
|
Financial
|
Insurance
(Property & Casualty)
|
-2.8%
|
|
MPAC
|
05/27/05
|
12.5%
|
MOD-PAC
CORP.
|
Basic
Materials
|
Paper
& Paper Products
|
-0.8%
|
|
NICK
|
05/27/05
|
-6.7%
|
Nicholas
Financial Inc.
|
Financial
|
Consumer
Financial Services
|
-14.4%
|
|
NOBH
|
05/27/05
|
12.5%
|
Nobility
Homes, Inc.
|
Capital
Goods
|
Construction
Services
|
-2.2%
|
|
NVR
|
07/22/05
|
6.3%
|
NVR, Inc.
|
Capital
Goods
|
Construction
Services
|
0.0%
|
|
PKZ
|
07/01/05
|
11.0%
|
PetroKazakhstan
Inc. (USA)
|
Energy
|
Oil Well
Services & Equipment
|
0.0%
|
|
POOL
|
06/10/05
|
6.5%
|
SCP Pool
Corporation
|
Consumer
Cyclical
|
Recreational
Products
|
-1.3%
|
|
RESP
|
06/03/05
|
10.5%
|
Respironics,
Inc.
|
Health
Care
|
Medical
Equipment & Supplies
|
0.0%
|
|
RIMG
|
05/27/05
|
15.6%
|
Rimage
Corporation
|
Technology
|
Computer
Peripherals
|
-2.3%
|
|
SFCC
|
07/08/05
|
4.3%
|
SFBC
International, Inc.
|
Health
Care
|
Biotechnology
& Drugs
|
-4.1%
|
|
SPF
|
05/27/05
|
19.2%
|
Standard
Pacific Corp.
|
Capital
Goods
|
Construction
Services
|
-3.1%
|
|
STST
|
07/29/05
|
#VALUE!
|
ARGON ST,
Inc.
|
Capital
Goods
|
Aerospace
and Defense
|
#VALUE!
|
|
TOL
|
05/27/05
|
21.7%
|
Toll
Brothers, Inc.
|
Capital
Goods
|
Construction
Services
|
-4.9%
|
|
ZQK
|
05/27/05
|
7.1%
|
Quiksilver,
Inc.
|
Consumer
Cyclical
|
Apparel/Accessories
|
0.0%
|
A performance summary of
filtering techniques for check lists and master traders we follow is given in
Table 3I.
Table 3I
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
|
13.7%
|
-0.3%
|
15.7%
|
3.0%
|
3.4%
|
6.2%
|
2.3%
|
|
Cash Rich Companies
|
2.2%
|
-0.5%
|
-2.8%
|
-2.8%
|
1.1%
|
-2.3%
|
1.2%
|
|
Growth Momentum Stocks
|
12.1%
|
-0.8%
|
4.5%
|
0.1%
|
1.6%
|
0.4%
|
2.2%
|
|
Lynch Stocks
|
8.7%
|
-0.3%
|
3.9%
|
0.0%
|
1.9%
|
1.6%
|
0.4%
|
|
Buffett Stocks
|
20.6%
|
-0.8%
|
5.9%
|
-1.0%
|
3.3%
|
1.1%
|
2.4%
|
|
Graham Stocks
|
11.4%
|
0.0%
|
1.2%
|
1.1%
|
0.7%
|
-0.1%
|
-0.5%
|
|
Templeton Stocks
|
10.0%
|
-0.8%
|
5.5%
|
0.8%
|
1.7%
|
1.7%
|
1.1%
|
|
Zweig Stocks
|
12.7%
|
-0.4%
|
8.2%
|
1.6%
|
3.0%
|
0.6%
|
2.7%
|
|
Average
|
11.4%
|
-0.5%
|
5.2%
|
0.4%
|
2.1%
|
1.2%
|
1.5%
|
4.0
Trading Results
This section highlights
performance of stocks and options trades. Only a summary is provided here to
save space. Detailed lists of closed trades can be found on the portfolio page of the
website.
Option Trading Model
|
Trading Model
|
|
Number of trades in 2005 =
|
50
|
(1.6 Trades per Week)
|
|
Number of contracts per trade =
|
2
|
|
|
Avg. Premium Cost per trade =
|
$1,378.72
|
|
|
Total Premium costs =
|
$68,936.00
|
|
|
Gross Profit =
|
$7,759.51
|
|