S&P500 vs Filters

Text Box: Wiser Trader Stocks and Options Newsletter
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Issue No. 57 – December 19, 2005 Prescott, Arizona Systems@WiserTrader.com

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1.0 Trading

As more analysis is done on the 1 year performance of stocks that have been screened using our favorite filters, a picture begins to develop.

1.1 Absolute Value Filter and S&P 500

Results have been reported over the past few months on the 1 year behavior of stocks that have been screened using several stock filters. Stocks have been grouped into 3 growth stock categories ($4 to $15, $15 to $40 and above $40) and two value stock categories (absolute value metrics and industry relative metrics). These filters are described on the website.

Recently it was shown how growth stocks priced above $40 performed about as well as value stocks over the past year. Growth stocks price from $4 to $15 performed poorly and were dropped from the study. Growth stocks price from $15 to $40 performed about two thirds as well as value stocks over the past year.

The most impressive result has been the relative ineffectiveness of trailing stops in preserving capital and improving returns on capital for market conditions defined in terms of the S&P 500 Index over different 1 year periods described in Table 1.

Table 1

Filter Performance versus the S&P 500 Index

Using No Trailing Stop

Date Range	S&P 500	Growth $15-$40 Filter	Growth >$40 Filter	Absolute Value Filter
9/04 to 9/05	8.5%			29%
11/04 to 11/05	4.0%	19%	29%
12/9/04 to 12/9/05	6.0%			21%

© 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.

Closer attention to detail reveals that absolute value filtered stock gains were reduced 25% when the S&P 500 gains were reduced from 8.5% in the September ’04 to September ’05 time frame to 6% in the December ’04 to December ’05 time frame. For the latter time frame Table 2 shows that a 20% trailing stop begins to have a noticeable effect, although still not very significant.

Table 2

Effect of Trailing Stop on Absolute Value Filter

December ’04 to December ‘05

Stop Loss Setting (%)	Average Gain reached Using Stop	Month that stop was triggered	Percent stopped out	Percent that Gained
10	6.5%	3.5	66.7%	77.8%
15	7.4%	4.0	44.4%	55.6%
20	23.4%	6.0	33.3%	77.8%
25	21.2%	7.0	33.3%	77.8%
30	21.2%	7.0	33.3%	77.8%
35	20.9%	9.5	22.2%	77.8%
40	21.4%	8.0	11.1%	77.8%
50	21.4%	8.0	11.1%	77.8%
60	20.5%	10.0	11.1%	77.8%
70	20.9%	none	0.0%	77.8%
80	20.9%	none	0.0%	77.8%
90	20.9%	none	0.0%	77.8%
100	20.9%	none	0.0%	77.8%

It also has not escaped notice that the performance of the two remaining growth filter categories performed pretty well for the amount of S&P 500 gain over the November ’04 to November ’05 period. As these studies continue a more apples to apples comparison must be done in order to really compare the two growth filter categories with the two value filter categories of stocks.

Based on existing data, however, as gains for the S&P 500 Index dropped below about 6%, over the past year, the use of a trailing stop became more effective in preserving capital for absolute value filtered stocks. When the S&P performance was 8.5%, trailing stops were actually detrimental to profits.

As these studies continue, more S&P 500 data points can be compared to growth and value filter performance data points and a comprehensive picture can be developed that has statistical significance. While it must be remembered that past results are no guarantee of future performance, the fact that the data are just 1 year old lends some degree of validity to judging recent trends in market sentiment and gives a degree of confidence on how these filters have performed in the recent past. Experience is everything.

2.0 Market Analysis

Major indices continued their sideways movement for the third week. This consolidation appears to be profit taking, in part due to memories of the sell off with reduced volume that occurred a year ago last January. A change in the FOMC policy statement, as to whether the end of the rate tightening period is near, was fully expected and had little impact. The VIX and VXN have moved back below their 20 day simple moving averages.

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 (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 Industrials	1.0%	0.9%	-0.9%	-0.5%	1.5%
NASDAQ	1.1%	-0.2%	-0.7%	0.5%	1.6%
S & P 500	1.5%	0.6%	-0.5%	-0.2%	1.6%
Russell 2000	1.6%	-0.8%	-0.3%	1.0%	1.7%
GLD, GOLD	3.4%	-4.4%	4.1%	1.8%	2.0%
RKH, Banking	2.2%	1.5%	-0.5%	-1.2%	2.4%
IYT, Transportation	0.0%	1.0%	-0.9%	-0.9%	0.8%
SMH, Semiconductors	4.3%	0.3%	-2.5%	3.9%	2.7%
BBH, Biotechnology	-4.5%	-1.5%	-2.3%	-0.4%	-0.3%
IYR, Real Estate	1.9%	0.6%	-0.7%	-0.5%	2.5%
OIH, Oil	8.6%	-2.3%	3.3%	1.6%	6.0%
XLE, Energy	4.1%	-1.4%	1.3%	0.3%	4.0%
XLU, Utilities	3.7%	1.0%	1.4%	-0.6%	1.9%
XLB, Materials	1.7%	-1.4%	0.3%	1.4%	1.4%
XLI, Industrial	1.2%	0.7%	-0.8%	0.3%	1.0%
XLK, Technology	0.1%	-1.1%	-0.9%	0.7%	1.4%
XLV, Healthcare	1.4%	1.6%	0.1%	-0.3%	0.0%
XLF, Financials	0.9%	0.3%	-0.7%	-1.0%	2.4%
XLP, Consumer Staples	1.7%	1.9%	-0.7%	-0.7%	1.3%
XLY, Consumer Discretionary	0.7%	0.1%	-0.7%	-0.3%	1.5%

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 10-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.

A column labeled “Weekly % Gain” was added to show the inverse relationship between price action over the past week and the Williams %R.

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 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 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	1 Month	1 Week Ago	2 weeks Ago	3 Weeks Ago	4 Weeks Ago
Net Insider Buying	4.3%	0.1%	5.1%	-0.8%	2.1%	0.5%	3.4%
Cash Rich Companies	0.5%	0.5%	0.6%	-0.7%	-0.3%	1.2%	0.5%
Price to Free Cash Flow	0.5%	-0.9%	-2.9%	-1.1%	-2.9%	-0.2%	1.3%
Growth Momentum Stocks	7.0%	-0.2%	3.6%	-0.7%	1.2%	1.1%	2.1%
Lynch Stocks	23.3%	0.1%	3.9%	2.7%	-1.8%	1.8%	1.2%
Buffett Stocks	17.4%	-0.3%	2.5%	0.0%	-1.0%	0.6%	2.9%
Graham Stocks	13.9%	0.4%	5.6%	2.0%	0.3%	0.7%	2.5%
Templeton Stocks	6.7%	-0.2%	1.7%	-0.1%	0.0%	0.4%	1.5%
Zweig Stocks	18.0%	-0.5%	7.3%	0.8%	2.1%	0.3%	3.6%
Average Long Stocks	10.2%	-0.1%	3.1%	0.2%	0.0%	0.7%	2.1%

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
RGN	12/16/05	0.0%	RegeneRx Biopharmaceut.	Health Care	Biotechnology & Drugs	0.0%	-5.9%	-100	-100
RNAI	12/09/05	-4.7%	Sirna Therapeutics, Inc.	Health Care	Biotechnology & Drugs	-5.6%	-4.7%	-98	-98
SNSS	12/16/05	0.0%	Sunesis Pharmaceuticals, Inc.	Health Care	Major Drugs	0.0%	-6.2%	-96	-96
MMLP	11/25/05	0.0%	Martin Midstream Partners L.P.	Transportation	Water Transportation	-4.7%	-1.3%	-98	-82
ULBI	12/02/05	0.3%	Ultralife Batteries, Inc.	Technology	Electronic Instruments & Controls	-2.7%	-1.9%	-33	-67
VSTA	10/21/05	1.5%	VistaCare, Inc.	Health Care	Healthcare Facilities	-7.5%	-3.8%	-67	-64
XGEN	11/25/05	0.0%	Xenogen Corporation	Technology	Scientific & Technical Instruments	-8.4%	-5.2%	-57	-57
AUXL	12/02/05	-1.4%	Auxilium Pharmaceuticals, Inc.	Health Care	Biotechnology & Drugs	-11.2%	-7.2%	-51	-52
MTRX	10/14/05	5.1%	Matrix Service Company	Capital Goods	Construction Services	-5.9%	-0.1%	-57	-47
PCTY	09/16/05	28.0%	Party City Corporation	Services	Retail (Specialty Non-Apparel)	-1.9%	-1.6%	-39	-43
CLRT	11/18/05	4.9%	Clarient, Inc.	Technology	Scientific & Technical Instruments	-8.5%	2.4%	-77	-30
CWEI	12/09/05	0.0%	Clayton Williams Energy, Inc.	Energy	Oil & Gas Operations	-2.7%	-2.7%	-27	-29
HEM	12/16/05	0.0%	Hemosense, Inc.	Health Care	Medical Equipment & Supplies	0.0%	8.9%	-28	-25
TRMA	10/28/05	6.0%	Trico Marine Services Inc	Energy	Oil Well Services & Equipment	-1.3%	-0.5%	-23	-25
BDOG	12/16/05	0.0%	Big Dog Holdings, Inc.	Services	Retail (Apparel)	0.0%	0.0%	-23	-24
MBRX	10/14/05	33.2%	Metabasis Therapeutics, Inc.	Health Care	Biotechnology & Drugs	-0.4%	12.5%	-3	-4
CRYO	11/25/05	0.0%	CryoCor, Inc.	Health Care	Medical Equipment & Supplies	0.0%	4.3%	-2	-2

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
KEYN	11/25/05	0.0%	Keynote Systems, Inc.	Technology	Computer Services	-4.3%	-3.1%	-83	-74
WSC	07/01/05	1.0%	Wesco Financial Corporation	Conglomerates	Conglomerates	0.0%	1.7%	-13	-1

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	Weekly % Gain	%R1	%R2
PBR	11/25/05	2.2%	Petroleo Brasileiro S.A. (ADR)	Energy	Oil & Gas - Integrated	-5.8%	-2.8%	-78	-94
TEO	12/09/05	0.8%	Telecom Argentina S.A. (ADR)	Services	Communications Services	-2.5%	0.8%	-51	-63
PLNR	11/25/05	-4.3%	Planar Systems, Inc.	Technology	Electronic Instruments & Controls	-6.5%	-3.4%	-95	-60
PCW	11/11/05	-0.3%	PCCW Ltd. (ADR)	Services	Communications Services	-5.9%	-1.6%	-56	-52
F	11/11/05	4.1%	FORD MOTOR	Consumer Cyclical	Auto & Truck Manufacturers	-2.7%	1.5%	-53	-23

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
CHL	03/18/05	45.7%	China Mobile (Hong Kong) Limited (ADR)	Services	Communications Services	-4.0%	2.3%	-56	-68
SKM	02/07/05	1.7%	SK Telecom Co., Ltd. (ADR)	Services	Communications Services	-11.4%	1.6%	-44	-52
BTI	08/12/05	13.7%	British American Tobacco (ADR)	Consumer Non-Cyclical	Tobacco	-1.2%	2.0%	-26	-34
KOF	04/29/05	17.8%	Coca-Cola FEMSA, S.A. (ADR)	Consumer Non-Cyclical	Beverages (Non-Alcoholic)	-6.1%	5.0%	-33	-34
TM	12/13/04	31.0%	Toyota Motor Corporation (ADR)	Consumer Cyclical	Auto & Truck Manufacturers	-2.5%	1.4%	-62	-22
TMX	06/03/05	30.0%	Telefonos de Mexico, S.A. (ADR)	Services	Communications Services	0.0%	3.9%	-16	-11

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

Table 3F

Growth Momentum Watch List

Stock	Reference	% Chg	Company	Sector	Industry	% from Max	Weekly % Gain	%R1	%R2
MOT	12/09/05	-4.3%	Motorola, Inc.	Technology	Communications Equipment	-4.3%	-4.3%	-85	-99
VIP	12/09/05	-5.4%	Vimpel-Communications (ADR)	Services	Communications Services	-5.4%	-5.4%	-94	-99
BHP	09/09/05	2.3%	BHP Billiton Limited (ADR)	Basic Materials	Metal Mining	-5.7%	-1.2%	-86	-98
VTIV	11/11/05	-6.7%	Ventiv Health, Inc.	Services	Business Services	-8.4%	-5.6%	-43	-97
WSO	11/25/05	-2.9%	Watsco, Incorporated	Capital Goods	Misc. Capital Goods	-11.5%	-8.7%	-93	-90
BJS	11/04/05	11.2%	BJ Services Company	Energy	Oil Well Services & Equipment	-3.4%	-1.2%	-31	-78
HCC	10/21/05	9.5%	HCC Insurance Holdings, Inc.	Financial	Insurance (Property & Casualty)	-9.5%	-1.3%	-87	-75
OSK	03/12/05	14.4%	Oshkosh Truck Corporation	Consumer Cyclical	Auto & Truck Manufacturers	-1.7%	-1.1%	-16	-62
CHE	05/06/05	32.9%	Chemed Corporation	Services	Business Services	-4.4%	0.2%	-49	-61
CTX	11/18/05	-3.2%	Centex Corporation	Capital Goods	Construction Services	-6.1%	0.6%	-50	-58
PCU	12/02/05	2.6%	Southern Copper Corporation (USA)	Basic Materials	Metal Mining	-2.5%	-0.5%	-45	-57
ZIGO	12/09/05	-5.3%	Zygo Corporation	Technology	Semiconductors	-5.3%	-5.3%	-43	-56
LM	08/12/05	10.6%	Legg Mason, Inc.	Financial	Investment Services	-4.3%	0.1%	-84	-50
BEN	11/04/05	6.4%	Franklin Resources	Financial	Investment Services	-1.0%	-0.9%	-26	-49
AMTD	10/28/05	19.0%	Ameritrade Holding Corp.	Financial	Investment Services	-1.0%	0.5%	-35	-47
ADTN	11/25/05	0.0%	ADTRAN, Inc.	Technology	Communications Equipment	0.0%	0.5%	-26	-46
ENDP	11/18/05	2.0%	Endo Pharmaceuticals	Health Care	Biotechnology & Drugs	-3.0%	0.5%	-29	-46
UNH	04/15/05	35.4%	UnitedHealth Group Inc.	Financial	Insurance (Accident & Health)	-0.8%	-0.8%	-30	-43
GOL	12/16/05	0.0%	GOL Linhas Aereas Inteligentes SA (ADR)	Transportation	Airline	0.0%	11.4%	-38	-10
SYT	04/08/05	10.7%	Syngenta AG (ADR)	Basic Materials	Chemical Manufacturing	0.0%	2.9%	-13	-7
ET	10/21/05	18.7%	E*TRADE FINANCIAL Corporation	Financial	Investment Services	0.0%	5.3%	-7	-5

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	Weekly % Gain	%R1	%R2
RS	04/15/05	63.4%	Reliance Steel & Aluminum	Basic Materials	Misc. Fabricated Products	-5.9%	-4.4%	-97	-100
LNCR	12/27/04	-0.8%	Lincare Holdings Inc.	Health Care	Healthcare Facilities	-9.1%	-2.9%	-86	-97
RCII	10/21/05	17.3%	Rent-A-Center, Inc	Services	Rental & Leasing	-5.5%	-2.2%	-80	-96
DSPG	02/07/05	-0.9%	DSP Group, Inc.	Technology	Communications Equipment	-8.8%	-8.3%	-96	-94
PGR	12/27/04	42.2%	The Progressive Corp.	Financial	Insurance (Property & Casualty)	-3.3%	-3.0%	-70	-93
ASH	10/28/05	5.7%	Ashland Inc.	Capital Goods	Construction Services	-3.3%	-1.6%	-72	-89
NUE	04/15/05	35.8%	Nucor Corporation	Basic Materials	Iron & Steel	-4.3%	-1.1%	-90	-85
MIK	10/14/05	18.4%	Michaels Stores, Inc.	Services	Retail (Specialty Non-Apparel)	-4.5%	-1.2%	-64	-79
PSUN	12/09/05	-2.2%	Pacific Sunwear of CA	Services	Retail (Apparel)	-2.4%	-2.2%	-83	-78
STLD	12/16/05	0.0%	Steel Dynamics, Inc.	Basic Materials	Iron & Steel	0.0%	-3.0%	-72	-72
FNF	10/21/05	2.1%	Fidelity National Financial	Financial	Insurance (Property & Casualty)	-5.6%	-0.1%	-83	-68
FOSL	12/02/05	-0.8%	Fossil, Inc.	Consumer Cyclical	Jewelry & Silverware	-2.1%	0.5%	-60	-67
NKE	09/23/05	8.9%	NIKE, Inc.	Consumer Cyclical	Footwear	-3.2%	3.0%	-29	-48
EASI	09/09/05	22.9%	Engineered Support System	Capital Goods	Misc. Capital Goods	-0.3%	0.3%	-12	-34
RI	09/02/05	21.1%	Ruby Tuesday, Inc.	Services	Restaurants	-1.3%	2.6%	-9	-29
THO	04/15/05	48.6%	Thor Industries, Inc.	Capital Goods	Mobile Homes & RVs	-0.6%	2.1%	-21	-27
TOL	12/16/05	0.0%	Toll Brothers, Inc.	Capital Goods	Construction Services	0.0%	6.1%	-21	-26
HDI	10/14/05	6.8%	Harley-Davidson, Inc.	Consumer Cyclical	Recreational Products	-5.8%	2.4%	-27	-26
ABFS	04/29/05	38.4%	Arkansas Best Corporation	Transportation	Trucking	0.0%	4.5%	-19	-18
DHI	10/21/05	21.9%	D.R. Horton Inc.	Capital Goods	Construction Services	-0.3%	6.7%	-24	-17
ACS	04/29/05	16.5%	Affiliated Computer Services, Inc.	Technology	Computer Services	-2.0%	0.8%	-57	-16

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	Weekly % Gain	%R1	%R2
OKE	11/11/05	2.4%	ONEOK, Inc.	Utilities	Natural Gas Utilities	-2.1%	0.7%	-16	-76
CV	10/14/05	28.4%	Central Vermont Public Services Corp.	Utilities	Electric Utilities	-4.4%	0.3%	-87	-69
ATG	10/21/05	6.6%	AGL Resources Inc.	Utilities	Natural Gas Utilities	-2.9%	3.9%	-33	-29
CPK	05/06/05	20.0%	Chesapeake Utilities	Utilities	Natural Gas Utilities	-11.3%	0.4%	-15	-18
WPS	02/07/05	11.1%	WPS Resources Corp	Utilities	Electric Utilities	-3.8%	2.1%	-27	-17
PGN	01/10/05	2.1%	Progress Energy, Inc.	Utilities	Electric Utilities	-1.6%	1.7%	-11	-11
UU	06/10/05	1.0%	United Utilities PLC (ADR)	Utilities	Electric Utilities	-1.3%	2.6%	-19	-8
PNW	01/10/05	0.2%	Pinnacle West Capital	Utilities	Electric Utilities	-6.9%	2.1%	-4	-8
SRE	01/10/05	28.8%	Sempra Energy	Utilities	Natural Gas Utilities	-1.9%	2.3%	-7	-5
ATO	04/01/05	-0.5%	Atmos Energy Corporation	Utilities	Natural Gas Utilities	-9.9%	1.3%	-37	-5
KEP	01/10/05	53.1%	Korea Electric Power Corporation (ADR)	Utilities	Electric Utilities	0.0%	4.7%	-3	-3

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	Weekly % Gain	%R1	%R2
CHD	11/18/05	-2.0%	Church & Dwight Co., Inc.	Consumer Non-Cyclical	Personal & Household Products	-3.5%	-0.5%	-67	-96
KRON	10/28/05	-1.5%	Kronos Incorporated	Technology	Software & Programming	-9.7%	-6.5%	-87	-92
SFG	05/27/05	35.3%	StanCorp Financial Group, Inc.	Financial	Insurance (Life)	-4.2%	-1.8%	-87	-82
BBBY	12/09/05	0.0%	Bed Bath & Beyond Inc.	Services	Retail (Specialty Non-Apparel)	-1.4%	0.0%	-81	-81
WSM	09/02/05	14.9%	Williams-Sonoma, Inc.	Services	Retail (Specialty Non-Apparel)	-1.9%	-0.3%	-52	-76
EDMC	12/16/05	0.0%	Education Management Corp	Services	Schools	0.0%	-4.6%	-68	-68
CPS	05/27/05	6.0%	ChoicePoint Inc.	Services	Business Services	-2.8%	0.0%	-57	-62
AMSG	10/14/05	-0.2%	AmSurg Corp.	Health Care	Healthcare Facilities	-5.7%	-3.1%	-41	-57
HHS	10/28/05	4.4%	Harte-Hanks, Inc.	Services	Printing & Publishing	-0.5%	0.1%	-29	-48
EASI	06/03/05	17.9%	Engineered Support System	Capital Goods	Misc. Capital Goods	-0.3%	0.3%	-12	-34
SNV	05/27/05	-3.0%	Synovus Financial Corp.	Financial	Regional Banks	-5.2%	1.7%	-33	-31
DGX	08/19/05	4.2%	Quest Diagnostics Incorporated	Health Care	Healthcare Facilities	-0.8%	1.2%	-24	-27
TOL	12/09/05	6.1%	Toll Brothers, Inc.	Capital Goods	Construction Services	-1.6%	6.1%	-21	-26
MTB	05/27/05	7.6%	M&T Bank Corporation	Financial	Regional Banks	-1.2%	1.2%	-26	-17
CAKE	10/21/05	11.7%	The Cheesecake Factory Incorporated	Services	Restaurants	0.0%	2.3%	-57	-11
LOW	11/18/05	5.2%	Lowe's Companies, Inc.	Services	Retail (Home Improvement)	0.0%	2.1%	-9	-9

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	Weekly % Gain	%R1	%R2
SFY	10/14/05	7.9%	Swift Energy Company	Energy	Oil & Gas Operations	-9.8%	-6.1%	-87	-100
SUN	11/04/05	8.9%	Sunoco, Inc.	Energy	Oil & Gas Operations	-5.3%	-2.7%	-84	-95
SM	10/21/05	20.9%	St. Mary Land & Exploration Co.	Energy	Oil & Gas Operations	-5.0%	-2.7%	-29	-74
ESI	11/04/05	2.8%	ITT Educational Services	Services	Schools	-2.6%	-0.4%

Sentiment Indicator	Current	Last Week	2 Weeks Ago	Complacent	Cautious
VIX **	10.7	11.7	11.0	< 20	> 50
VXN ***	13.2	15.1	13.9	< 30	> 70
Put/Call Ratio	0.569	0.580	0.576	< 0.6	> 0.7
%Bulls - %Bears	37.2%	34.3%	34.7%	> 29%	< 20%
Below 20 day SMA = Buy signal. * Below 20 day SMA = Buy signal.