______________________________________________________________________________
Issue No. 50 – October 31, 2005
Prescott, Arizona Systems@WiserTrader.com
______________________________________________________________________________
1.0
Trading
This week looks at the
effectiveness of a stock filter based on year ago value metrics consisting of price
to earnings ratio (PE), price to book ratio (PB), price to sales ratio (PS),
return on equity (ROE) and price to free cash flow (P-FCF).
1.1 Value Filter
A
filter based on a recent study of five stock valuation metrics is given in
Table 1. Column 2 provides year ago values that had the lowest probability of
loss over the past year. Column three contains year ago values that had the
highest probability of a 25% or greater price gain. The last column contains
values used in the filter with emphasis on minimizing losses.
Table 1
A Value Stock
Filter to Minimize the Probability of Loss
|
Year Ago Metric
|
Value for Minimum
Risk of Loss
|
Value for Likelihood
of 25% or Greater Gain
|
Value Used in
Filter
|
|
Price to Earnings (PE)
|
<10
|
< 10
|
< 10
|
|
Price to Book (PB)
|
< 1
|
< 1
|
< 1
|
|
Price to Sales (PS)
|
< 0.5
|
< 0.5
|
< 0.5
|
|
Return on Equity (ROE)
|
10 to 20
|
50 to 100
|
10 to 20
|
|
Price to Free Cash Flow (P-FCF)
|
< 5
|
< 5
|
< 5
|
The filter sharply reduced
the number of stocks from about 2,000 down to four. Year ago stock prices
ranged from $12 to $54. The resulting average gain over the past year was
22%. The maximum gain was 33% and the minimum gain was 7%. There was never a draw
down and the maximum decline for any single stock was less than 3% for a one
month period. For this group of stocks, using or not using a stop loss would
have resulted in identical results. Details on each of the 5 value metric studies
can be found in recent newsletters beginning with the 9/12/05 issue.
© 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
Choppiness continues as
investors switch between concerns over inflation, relatively good earnings
reports and the occasional earnings warnings that appear to be consistent with
historical norms. About 70% of S&P500 companies have reported that
earnings are likely to reflect a 15% gain over the same quarter last year.
However, higher 10 year bond yields reduce the relative value of stocks and are
a major reason stocks have been flat this year despite good profit growth and
GDP values above the long-term trend of 3.1%.
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 Real
Estate are respective indicators for the inverse health of the currency and the
capacity for consumer spending.
Table 2A
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
|
|
DIA (DOW)
|
-1.8%
|
1.7%
|
-0.7%
|
-0.1%
|
-2.6%
|
|
QQQQ (NASDAQ 100)
|
-2.9%
|
-0.6%
|
1.3%
|
-0.7%
|
-2.8%
|
|
SPY (S&P 500)
|
-2.6%
|
1.4%
|
-0.5%
|
-0.8%
|
-2.8%
|
|
IWM (Russell 2000)
|
-5.0%
|
0.1%
|
0.2%
|
-1.9%
|
-3.4%
|
|
GLD, GOLD
|
1.1%
|
1.5%
|
-0.6%
|
-1.2%
|
1.4%
|
|
RKH, Banking
|
4.2%
|
2.6%
|
2.0%
|
0.4%
|
-0.9%
|
|
IYT, Transportation
|
0.4%
|
3.0%
|
-0.3%
|
-0.8%
|
-1.5%
|
|
SMH, Semiconductors
|
-9.8%
|
-4.1%
|
0.8%
|
-2.8%
|
-4.0%
|
|
BBH, Biotechnology
|
-0.5%
|
2.6%
|
-0.8%
|
1.2%
|
-3.5%
|
|
IYR, Real Estate
|
-3.5%
|
2.5%
|
-0.1%
|
-1.3%
|
-4.4%
|
|
OIH, Oil
|
-6.2%
|
6.5%
|
-2.5%
|
-1.8%
|
-8.0%
|
|
XLE,
Energy
|
-10.1%
|
4.9%
|
-4.8%
|
-2.4%
|
-7.7%
|
|
XLU,
Utilities
|
-7.6%
|
2.3%
|
-1.7%
|
-4.4%
|
-4.0%
|
|
XLB,
Materials
|
-0.1%
|
3.6%
|
0.8%
|
-1.0%
|
-3.3%
|
|
XLI,
Industrial
|
-1.7%
|
1.2%
|
-1.1%
|
-0.6%
|
-1.2%
|
|
XLK,
Technology
|
-3.3%
|
0.2%
|
0.8%
|
-1.0%
|
-3.3%
|
|
XLV,
Healthcare
|
-3.5%
|
0.1%
|
-1.9%
|
0.2%
|
-1.9%
|
|
XLF,
Financials
|
2.7%
|
3.2%
|
1.0%
|
-0.2%
|
-1.3%
|
|
XLP,
Consumer Staples
|
-0.9%
|
0.9%
|
0.5%
|
-0.4%
|
-1.9%
|
|
XLY,
Consumer Discretionary
|
-3.6%
|
0.1%
|
-0.4%
|
-1.0%
|
-2.4%
|
3.0 Procedure
The following watch lists contain
stock candidates for consideration. They are not necessarily trades.
Categories include check lists 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
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.
A column labeled “Weekly %
Gain” was added to show the inverse relationship between price action over the
past week and the Williams %R. With this systematic way of ranking stocks, the
complete list of stocks for each filter is presented.
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.
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. 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.
A performance summary of
filtering techniques for check lists and master trader selection methods is
given in Table 3A.
Table 3A
Stock Filter Summary
|
Filter
|
Avg. % Change Since Listed
|
Avg. % Change Friday
|
Past Month
|
Past Week
|
2 weeks Ago
|
3 Weeks Ago
|
4 Weeks Ago
|
|
Net Insider Buying
|
3.5%
|
-1.4%
|
2.7%
|
-0.8%
|
3.0%
|
-2.7%
|
3.4%
|
|
Cash Rich Companies
|
12.0%
|
2.0%
|
8.5%
|
1.5%
|
1.8%
|
2.8%
|
0.8%
|
|
Growth Momentum Stocks
|
6.8%
|
3.0%
|
-0.2%
|
2.4%
|
1.1%
|
-1.7%
|
-1.8%
|
|
Lynch Stocks
|
13.1%
|
0.6%
|
-5.2%
|
-0.2%
|
0.4%
|
-2.8%
|
-2.6%
|
|
Buffett Stocks
|
10.0%
|
2.4%
|
-2.2%
|
1.5%
|
0.7%
|
-1.0%
|
-3.3%
|
|
Graham Stocks
|
6.4%
|
1.8%
|
-7.6%
|
1.7%
|
-1.4%
|
-4.8%
|
-3.2%
|
|
Templeton Stocks
|
2.0%
|
1.3%
|
-1.4%
|
1.3%
|
0.1%
|
0.1%
|
-2.8%
|
|
Zweig Stocks
|
10.1%
|
2.2%
|
-3.1%
|
1.7%
|
1.0%
|
-1.9%
|
-3.7%
|
|
Average
|
8.0%
|
1.5%
|
-1.1%
|
1.1%
|
0.8%
|
-1.5%
|
-1.6%
|
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
|
Weekly % Gain
|
%R1
|
%R2
|
|
KIRK
|
09/30/05
|
-7.4%
|
Kirkland's, Inc.
|
Services
|
Retail
(Specialty Non-Apparel)
|
-10.1%
|
-6.1%
|
-67
|
-100
|
|
VSTA
|
10/21/05
|
-5.4%
|
VistaCare,
Inc.
|
Health
Care
|
Healthcare
Facilities
|
-7.6%
|
-5.4%
|
-70
|
-95
|
|
AMIC
|
10/21/05
|
-3.1%
|
American
Independence Corp.
|
Financial
|
Insurance
(Miscellaneous)
|
-3.3%
|
-3.1%
|
-61
|
-84
|
|
ISO
|
10/07/05
|
7.1%
|
ISCO
International, Inc.
|
Technology
|
Semiconductors
|
-14.3%
|
-14.3%
|
-64
|
-80
|
|
MEAD
|
09/30/05
|
-1.5%
|
Meade
Instruments Corp.
|
Technology
|
Scientific
& Technical Instruments
|
-5.8%
|
-3.3%
|
-83
|
-72
|
|
PCTY
|
09/16/05
|
23.1%
|
Party City
Corporation
|
Services
|
Retail
(Specialty Non-Apparel)
|
-3.8%
|
-0.4%
|
-46
|
-53
|
|
MBRX
|
10/14/05
|
2.0%
|
Metabasis
Therapeutics, Inc.
|
Health
Care
|
Biotechnology
& Drugs
|
-1.5%
|
-0.8%
|
-32
|
-42
|
|
MTRX
|
10/14/05
|
7.4%
|
Matrix
Service Company
|
Capital
Goods
|
Construction
Services
|
-3.6%
|
5.8%
|
-24
|
-37
|
|
TRMA
|
10/28/05
|
0.0%
|
Trico
Marine Services Inc
|
Energy
|
Oil Well
Services & Equipment
|
0.0%
|
0.8%
|
-45
|
-35
|
|
REDE
|
09/02/05
|
7.7%
|
RedEnvelope,
Inc.
|
Services
|
Retail
(Catalog & Mail Order)
|
-3.4%
|
10.1%
|
-11
|
-28
|
|
BABY
|
10/21/05
|
8.3%
|
Natus
Medical, Inc.
|
Health
Care
|
Medical Equipment
& Supplies
|
-0.1%
|
8.3%
|
-9
|
-11
|
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
|
Weekly % Gain
|
%R1
|
%R2
|
|
LDIS
|
10/28/05
|
0.0%
|
Leadis
Technology, Inc.
|
Technology
|
Semiconductors
|
0.0%
|
-16.5%
|
-99
|
-89
|
|
WSC
|
07/01/05
|
-2.7%
|
Wesco
Financial Corporation
|
Conglomerates
|
Conglomerates
|
-2.7%
|
-1.4%
|
-100
|
-44
|
|
WZEN
|
10/07/05
|
35.6%
|
Webzen
Inc. (ADR)
|
Technology
|
Computer
Services
|
-0.3%
|
15.8%
|
-23
|
-17
|
|
CLCT
|
10/07/05
|
15.2%
|
Collectors
Universe, Inc.
|
Services
|
Business
Services
|
0.0%
|
8.0%
|
-10
|
-5
|
For the screen in
Table 3D, the number of selections is reduced by selecting only optionable
stocks having P/E’s less than 30.
Table 3D
Growth Momentum Watch List
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
Weekly % Gain
|
%R1
|
%R2
|
|
LM
|
08/12/05
|
-4.7%
|
Legg
Mason, Inc.
|
Financial
|
Investment
Services
|
-5.2%
|
-1.5%
|
-70
|
-60
|
|
AMTD
|
10/28/05
|
0.0%
|
Ameritrade
Holding Corp.
|
Financial
|
Investment
Services
|
0.0%
|
1.4%
|
-79
|
-57
|
|
OSK
|
03/12/05
|
8.5%
|
Oshkosh
Truck Corporation
|
Consumer
Cyclical
|
Auto &
Truck Manufacturers
|
-1.6%
|
-0.2%
|
-92
|
-49
|
|
TDY
|
04/29/05
|
16.0%
|
Teledyne
Technologies Incorporated
|
Services
|
Business
Services
|
-9.5%
|
-1.1%
|
-33
|
-48
|
|
UNH
|
04/15/05
|
21.6%
|
UnitedHealth
Group Inc.
|
Financial
|
Insurance
(Accident & Health)
|
-2.5%
|
-0.7%
|
-83
|
-37
|
|
BHP
|
09/09/05
|
-2.6%
|
BHP
Billiton Limited (ADR)
|
Basic
Materials
|
Metal
Mining
|
-10.3%
|
2.3%
|
-50
|
-36
|
|
ET
|
10/21/05
|
1.1%
|
E*TRADE
FINANCIAL Corporation
|
Financial
|
Investment
Services
|
-2.7%
|
1.1%
|
-37
|
-36
|
|
CHE
|
05/06/05
|
19.8%
|
Chemed
Corporation
|
Services
|
Business
Services
|
0.0%
|
12.5%
|
-76
|
-15
|
|
SYT
|
04/08/05
|
-0.3%
|
Syngenta
AG (ADR)
|
Basic
Materials
|
Chemical
Manufacturing
|
-4.8%
|
1.2%
|
-12
|
-11
|
|
HCC
|
10/21/05
|
8.8%
|
HCC
Insurance Holdings, Inc.
|
Financial
|
Insurance
(Property & Casualty)
|
0.0%
|
8.8%
|
-27
|
0
|
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
|
Weekly % Gain
|
%R1
|
%R2
|
|
KOF
|
04/29/05
|
16.3%
|
Coca-Cola
FEMSA, S.A. (ADR)
|
Consumer
Non-Cyclical
|
Beverages
(Non-Alcoholic)
|
-7.3%
|
-3.1%
|
-44
|
-90
|
|
SKM
|
02/07/05
|
-0.9%
|
SK Telecom
Co., Ltd. (ADR)
|
Services
|
Communications
Services
|
-13.7%
|
-3.2%
|
-98
|
-73
|
|
TMX
|
06/03/05
|
6.4%
|
Telefonos
de Mexico, S.A. (ADR)
|
Services
|
Communications
Services
|
-8.3%
|
-0.3%
|
-84
|
-73
|
|
CHL
|
03/18/05
|
30.8%
|
China Mobile (Hong Kong) Limited (ADR)
|
Services
|
Communications
Services
|
-11.1%
|
-1.7%
|
-80
|
-73
|
|
NTE
|
05/06/05
|
12.9%
|
Nam Tai
Electronics, Inc.
|
Technology
|
Electronic
Instruments & Controls
|
-9.3%
|
-1.9%
|
-54
|
-59
|
|
PKX
|
04/29/05
|
9.8%
|
POSCO
(ADR)
|
Basic
Materials
|
Iron &
Steel
|
-12.4%
|
-0.8%
|
-55
|
-44
|
|
TM
|
12/13/04
|
21.7%
|
Toyota
Motor Corporation (ADR)
|
Consumer
Cyclical
|
Auto &
Truck Manufacturers
|
-2.9%
|
4.5%
|
-36
|
-7
|
|
BTI
|
08/12/05
|
8.3%
|
British
American Tobacco (ADR)
|
Consumer
Non-Cyclical
|
Tobacco
|
0.0%
|
4.7%
|
-15
|
-2
|
The filter for Warren
Buffet style stock picking in Table 3F 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 3F
Warren Buffett Value Watch List
Ranked According to the Most
Oversold Using the Williams %R
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
Weekly % Gain
|
%R1
|
%R2
|
|
EASI
|
09/09/05
|
20.1%
|
Engineered
Support System
|
Capital
Goods
|
Misc.
Capital Goods
|
-1.9%
|
-0.8%
|
-92
|
-75
|
|
DHI
|
10/21/05
|
-4.0%
|
D.R.
Horton Inc.
|
Capital
Goods
|
Construction
Services
|
-6.5%
|
-4.0%
|
-99
|
-69
|
|
DSPG
|
02/07/05
|
-4.7%
|
DSP Group,
Inc.
|
Technology
|
Communications
Equipment
|
-10.4%
|
-5.6%
|
-88
|
-63
|
|
FNF
|
10/21/05
|
0.6%
|
Fidelity
National Financial
|
Financial
|
Insurance
(Property & Casualty)
|
-1.3%
|
0.6%
|
-87
|
-57
|
|
HDI
|
10/14/05
|
-1.0%
|
Harley-Davidson,
Inc.
|
Consumer
Cyclical
|
Recreational
Products
|
-3.4%
|
-1.5%
|
-76
|
-56
|
|
RI
|
09/02/05
|
-0.6%
|
Ruby
Tuesday, Inc.
|
Services
|
Restaurants
|
-9.2%
|
-2.3%
|
-91
|
-47
|
|
LNCR
|
12/27/04
|
-4.3%
|
Lincare
Holdings Inc.
|
Health
Care
|
Healthcare
Facilities
|
-12.3%
|
-0.5%
|
-54
|
-42
|
|
NKE
|
09/23/05
|
1.9%
|
NIKE, Inc.
|
Consumer
Cyclical
|
Footwear
|
-1.5%
|
-0.8%
|
-50
|
-42
|
|
MIK
|
10/14/05
|
4.4%
|
Michaels
Stores, Inc.
|
Services
|
Retail
(Specialty Non-Apparel)
|
-1.9%
|
-0.8%
|
-75
|
-35
|
|
THO
|
04/15/05
|
21.6%
|
Thor
Industries, Inc.
|
Capital
Goods
|
Mobile
Homes & RVs
|
-9.4%
|
2.3%
|
-52
|
-33
|
|
RCII
|
10/21/05
|
9.6%
|
Rent-A-Center,
Inc
|
Services
|
Rental
& Leasing
|
-3.2%
|
9.6%
|
-35
|
-29
|
|
ABFS
|
04/29/05
|
20.5%
|
Arkansas
Best Corporation
|
Transportation
|
Trucking
|
-1.4%
|
13.1%
|
-44
|
-23
|
|
CECO
|
09/30/05
|
-0.7%
|
Career
Education Corp.
|
Services
|
Schools
|
-1.6%
|
0.7%
|
-64
|
-16
|
|
ACS
|
04/29/05
|
11.3%
|
Affiliated
Computer Services
|
Technology
|
Computer
Services
|
-2.8%
|
-0.2%
|
-20
|
-14
|
|
RS
|
04/15/05
|
44.2%
|
Reliance
Steel & Aluminum
|
Basic
Materials
|
Misc.
Fabricated Products
|
0.0%
|
5.9%
|
-30
|
-13
|
|
NUE
|
04/15/05
|
22.8%
|
Nucor
Corporation
|
Basic
Materials
|
Iron &
Steel
|
-0.6%
|
5.4%
|
-36
|
-9
|
|
ASH
|
10/28/05
|
0.0%
|
Ashland
Inc.
|
Capital
Goods
|
Construction
Services
|
0.0%
|
1.8%
|
-46
|
-6
|
|
PGR
|
12/27/04
|
38.0%
|
The
Progressive Corp.
|
Financial
|
Insurance
(Property & Casualty)
|
0.0%
|
5.0%
|
-34
|
0
|
Stocks from Benjamin
Graham’s style of utility investing are listed in Table 3G. A requirement was
added to include only those stocks having a PE of 17 or less.
Table 3G
Benjamin Graham Utility Watch List
Ranked According to the Most
Oversold Using the Williams %R
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
Weekly % Gain
|
%R1
|
%R2
|
|
NFG
|
04/08/05
|
5.0%
|
National
Fuel Gas Co.
|
Utilities
|
Natural
Gas Utilities
|
-13.8%
|
-0.5%
|
-98
|
-74
|
|
PNW
|
01/10/05
|
-5.2%
|
Pinnacle
West Capital
|
Utilities
|
Electric
Utilities
|
-11.9%
|
1.4%
|
-69
|
-53
|
|
UU
|
06/10/05
|
-8.6%
|
United
Utilities PLC (ADR)
|
Utilities
|
Electric
Utilities
|
-10.7%
|
0.5%
|
-79
|
-52
|
|
ATO
|
04/01/05
|
-2.8%
|
Atmos
Energy Corporation
|
Utilities
|
Natural
Gas Utilities
|
-12.0%
|
1.5%
|
-65
|
-34
|
|
KEP
|
01/10/05
|
32.9%
|
Korea
Electric Power Corporation (ADR)
|
Utilities
|
Electric
Utilities
|
-10.5%
|
1.0%
|
-61
|
-33
|
|
CV
|
10/14/05
|
-0.1%
|
Central
Vermont Public Services Corp.
|
Utilities
|
Electric
Utilities
|
-0.7%
|
-0.7%
|
-100
|
-30
|
|
WPS
|
02/07/05
|
4.6%
|
WPS
Resources Corp
|
Utilities
|
Electric
Utilities
|
-9.5%
|
1.7%
|
-51
|
-28
|
|
ATG
|
10/21/05
|
3.2%
|
AGL
Resources Inc.
|
Utilities
|
Natural
Gas Utilities
|
-0.7%
|
3.2%
|
-59
|
-18
|
|
SRE
|
01/10/05
|
19.1%
|
Sempra
Energy
|
Utilities
|
Natural
Gas Utilities
|
-9.4%
|
3.8%
|
-59
|
-17
|
|
CPK
|
05/06/05
|
24.1%
|
Chesapeake Utilities
|
Utilities
|
Natural
Gas Utilities
|
-8.3%
|
3.2%
|
-23
|
-4
|
|
PGN
|
01/10/05
|
-2.0%
|
Progress
Energy, Inc.
|
Utilities
|
Electric
Utilities
|
-5.6%
|
3.2%
|
-38
|
-2
|
Optionable stocks from John Templeton’s style of
investing are listed in Table 3H.
Table 3H
John Templeton Watch List
Ranked According to the Most
Oversold Using the Williams %R
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
Weekly % Gain
|
%R1
|
%R2
|
|
HHS
|
10/28/05
|
0.0%
|
Harte-Hanks,
Inc.
|
Services
|
Printing
& Publishing
|
0.0%
|
-2.4%
|
-64
|
-80
|
|
EASI
|
06/03/05
|
15.1%
|
Engineered
Support System
|
Capital
Goods
|
Misc.
Capital Goods
|
-1.9%
|
-0.8%
|
-92
|
-75
|
|
DGX
|
08/19/05
|
-7.0%
|
Quest
Diagnostics Incorporated
|
Health
Care
|
Healthcare
Facilities
|
-9.7%
|
-2.0%
|
-84
|
-68
|
|
WSM
|
09/02/05
|
-1.6%
|
Williams-Sonoma,
Inc.
|
Services
|
Retail
(Specialty Non-Apparel)
|
-5.3%
|
-0.7%
|
-85
|
-48
|
|
JNJ
|
05/27/05
|
-6.6%
|
Johnson
& Johnson
|
Health
Care
|
Major
Drugs
|
-6.6%
|
-1.7%
|
-89
|
-46
|
|
CAKE
|
10/21/05
|
-1.5%
|
The
Cheesecake Factory Incorporated
|
Services
|
Restaurants
|
-2.7%
|
-1.5%
|
-59
|
-37
|
|
CPS
|
05/27/05
|
6.1%
|
ChoicePoint
Inc.
|
Services
|
Business
Services
|
-2.8%
|
2.9%
|
-21
|
-21
|
|
AMSG
|
10/14/05
|
3.4%
|
AmSurg
Corp.
|
Health
Care
|
Healthcare
Facilities
|
-0.4%
|
1.3%
|
-64
|
-21
|
|
SNV
|
05/27/05
|
-7.0%
|
Synovus
Financial Corp.
|
Financial
|
Regional
Banks
|
-9.1%
|
2.7%
|
-68
|
-19
|
|
KRON
|
10/28/05
|
0.0%
|
Kronos
Incorporated
|
Technology
|
Software
& Programming
|
0.0%
|
6.8%
|
-6
|
-17
|
|
SFG
|
05/27/05
|
19.9%
|
StanCorp
Financial Group, Inc.
|
Financial
|
Insurance
(Life)
|
0.0%
|
8.1%
|
-1
|
-1
|
|
MTB
|
05/27/05
|
3.5%
|
M&T
Bank Corporation
|
Financial
|
Regional
Banks
|
-5.0%
|
3.0%
|
-33
|
0
|
Optionable stocks from
Martin Zweig’s style of investing are listed in Table 3I.
Table 3I
Martin Zweig Watch List
Ranked According to the Most
Oversold Using the Williams %R
|
Stock
|
Reference
|
% Chg
|
Company
|
Sector
|
Industry
|
% from Max
|
Weekly % Gain
|
%R1
|
%R2
|
|
CMTL
|
07/01/05
|
14.0%
|
Comtech
Telecomm. Corp.
|
Technology
|
Communications
Equipment
|
-11.9%
|
-8.5%
|
-88
|
-81
|
|
EXP
|
10/28/05
|
0.0%
|
Eagle
Materials, Inc.
|
Capital
Goods
|
Construction
- Raw Materials
|
0.0%
|
-3.5%
|
-87
|
-76
|
|
CRDN
|
08/19/05
|
24.1%
|
Ceradyne,
Inc.
|
Capital
Goods
|
Aerospace
and Defense
|
-10.3%
|
1.0%
|
-93
|
-66
|
|
CAE
|
06/10/05
|
12.9%
|
Cascade
Corporation
|
Capital
Goods
|
Misc.
Capital Goods
|
-5.7%
|
-1.2%
|
-86
|
-53
|
|
MCO
|
07/29/05
|
11.9%
|
Moody's
Corporation
|
Services
|
Business
Services
|
-2.7%
|
3.4%
|
-19
|
-53
|
|
BEN
|
10/28/05
|
0.0%
|
Franklin Resources
|
Financial
|
Investment
Services
|
0.0%
|
3.7%
|
-27
|
-46
|
|
CTX
|
10/28/05
|
0.0%
|
Centex
Corporation
|
Capital
Goods
|
Construction
Services
|
0.0%
|
-1.0%
|
-85
|
-38
|
|
SFY
|
10/14/05
|
4.9%
|
Swift
Energy Company
|
Energy
|
Oil &
Gas Operations
|
-1.3%
|
6.9%
|
-57
|
-27
|
|
SFCC
|
07/08/05
|
10.9%
|
SFBC
International, Inc.
|
Health
Care
|
Biotechnology
& Drugs
|
-5.6%
|
0.7%
|
-52
|
-27
|
|
JUPM
|
08/19/05
|
6.5%
|
Jupitermedia
Corporation
|
Services
|
Advertising
|
-5.8%
|
-0.1%
|
-42
|
-26
|
|
COP
|
10/28/05
|
0.0%
|
ConocoPhillips
|
Energy
|
Oil &
Gas - Integrated
|
0.0%
|
8.8%
|
-54
|
-25
|
|
SM
|
10/21/05
|
7.0%
|
St. Mary
Land & Exploration Co.
|
Energy
|
Oil &
Gas Operations
|
0.0%
|
7.0%
|
-51
|
-21
|
|
PKZ
|
07/01/05
|
44.6%
|
HURRICANE
HYDROCARBONS LTD
|
Energy
|
Oil Well
Services & Equipment
|
-1.1%
|
2.3%
|
-1
|
-1
|
|
POOL
|
06/10/05
|
4.8%
|
SCP Pool
Corporation
|
Consumer
Cyclical
|
Recreational
Products
|
-2.9%
|
4.2%
|
-19
|
-1
|
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.
Options Trading
|
Options Trading Estimation Model -
Minimum Suggested Initial Capital is $3,000
|
|
Number of trades in 2005 =
|
66
|
66
|
66
|
(1.5 trades per week)
|
|
Number of contracts per trade =
|
1
|
2
|
3
|
|
|
Avg. Premium Cost per trade =
|
$627.39
|
$1,254.79
|
$1,882.18
|
|
|
Total Premiums =
|
$41,408.00
|
$82,816.00
|
$124,224.00
|
|
|
Gross Profit =
|
$3,858.01
|
$7,716.02
|
$11,574.04
|
(9.8%)
|
|
Broker Commission (Etrade) =
|
-$1,483.68
|
-$1,648.68
|
-$1,813.68
|
|
|
Subscription Cost to date =
|
-$600.00
|
-$600.00
|
-$600.00
|
|
|
Net Profit After Expenses =
|
$1,774.33
|
$5,467.34
|
$9,160.36
|
(Avg.
holding period 8.0 days)
|
5.0 Conclusion
Net Growth of Total Capital in
2005
|
Options
Advisory (trading 2 contracts)
Aggressive, 20% of risk capital per trade
Moderate, 15% of risk capital per trade
Conservative, 10% of risk capital per trade
|
+ 87.1%
+ 65.3%
+ 43.5%
|
|
Major Indices Year to Date
10/29/05
|
|
DOW
|
-3.5%
|
|
NASDAQ
|
-3.9%
|
|
S&P500
|
-1.1%
|
|
Russell
2000
|
-2.5%
|
Appendix - Investment Conference
Schedule
Below are links to
conference registration sites where you can sign up.
- 11-10-05 Millbrae, CA "Biotech Investing
Conference" Continuing advances in genomics, proteomics and
enabling technologies makes the Biotech sector a favorite among private
equity investors and venture capitalists. The Biotech Investing Conference
is an industry gathering of the leading private equity investors, venture
capitalists, biotech companies, pharmaceutical companies, corporate
investors and institutional investors.
- 11-27-05 San Francisco, CA "Gold and Precious Metals Conference"
Both
professional and sophisticated private investors meet with the world's
leaders in gold, silver, precious metals, copper and oil and gas
exploration and production. The Natural Resource industry's newest
opportunities are presented, together with educational seminars, executive
panels and investment workshops led by top finance specialists, economic
analysts and newsletter editors. Admission is complimentary with
pre-registration.
- 01-30-06 Miami, Florida "IIR’s 19th Annual
Private Placements Industry Forum" is the pre-eminent gathering for the latest developments in
originating, buying and structuring private debt placements. Join us in
sunny Miami, Florida in January as the industry’s leading decision makers
discuss new market trends, including: project finance, cross border deals
and the impact of pre-designated investor counsel. Plus, enjoy over 6 hours of networking opportunities including our two hour Rooftop Dessert and Cordial Suite. Don’t delay, register for
the Institute for International
Research's 19th Annual Private Placements Industry Forum today!.
- 02-07-06 Cape Town, South Africa "Investing in African
Mining Conference" Africa's most important
mining event and the world's leading gathering of global policy makers and
international finance, the Mining INDABA has raised billions of dollars
and introduced the international investment community to mining interests
throughout Africa. The Mining Indaba has become an institution
throughout Africa, attracting over 2,000 delegates from fifty countries
and hosting over 100 exhibitors.
Conference Search
