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WiserTrader Monthly |
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__________________________________________________________________________
June 2007 Prescott, Arizona Contact Editor __________________________________________________________________________
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Published the 3rd Tuesday of the month
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Stock Picks and Industry RankingJames Andrews June 19, 2007
___________________________________________________________________________ Top down stock picking based on the leading stocks in leading industries should be supplemented with additional fundamental and chart analysis. ___________________________________________________________________________
1.0 Leading Industries
About 90% of an industry’s rank is weighted by the percent increase in its index price over the previous 4 weeks and 10% is weighted by how much the index is oversold based on its 10-period Williams-%R. Industry rank ranges from a high of 1 to a low of 215 based on a list of 215 industries in the Yahoo Finance industry classification system.
The main reason for using this classification system is the ready availability of industry performance. Each industry’s performance is accessible through online data retrieval software that imports the numbers directly from Yahoo Finance and sorts them in a spreadsheet. These tools are available on the website.
The leading industries for the past month are ranked in Table 1A. The leftmost column is the rank. The second column from the left is the number of positions an industry is above or below its 4-week average rank.. The third column from the left is the relative rank of the industry based its movement above its average rank. Clicking on the industry name takes you to an industry summary page. The “C’s” will display the companies in the industry. The last three columns on the right are the percentage gains for the previous trading day, the previous week and the previous four weeks.
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Table 1A
Leading Industries
June 18, 2007
|
Rank |
Relative To Avg. Position |
Rank of Position Change |
Leading Industries |
Companies |
Last Gain |
1 wk Ago Gain |
1 mo Gain |
|
1 |
56 |
36 |
1.2% |
43.4% |
41.4% |
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|
2 |
129 |
5 |
-0.5% |
39.7% |
31.2% |
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|
3 |
63 |
31 |
0.2% |
15.4% |
17.7% |
||
|
4 |
81 |
16 |
-0.3% |
15.0% |
18.9% |
||
|
5 |
76 |
19 |
0.0% |
7.7% |
10.4% |
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|
6 |
52 |
38 |
1.2% |
6.4% |
6.2% |
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|
7 |
23 |
68 |
-0.2% |
5.7% |
13.8% |
||
|
8 |
-1 |
99 |
2.4% |
4.8% |
13.0% |
||
|
9 |
22 |
69 |
-0.4% |
2.1% |
10.4% |
||
|
10 |
119 |
7 |
-0.1% |
3.4% |
3.6% |
||
|
11 |
51 |
40 |
-1.2% |
-0.6% |
4.3% |
||
|
12 |
64 |
29 |
0.3% |
4.9% |
2.3% |
||
|
13 |
96 |
13 |
-0.3% |
4.6% |
7.0% |
||
|
14 |
77 |
18 |
-0.3% |
-0.6% |
4.3% |
||
|
15 |
48 |
45 |
-0.5% |
4.7% |
4.1% |
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|
16 |
70 |
22 |
0.2% |
4.0% |
10.8% |
||
|
17 |
110 |
10 |
-0.2% |
10.9% |
10.7% |
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|
18 |
88 |
15 |
0.1% |
6.4% |
6.8% |
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|
19 |
68 |
25 |
0.0% |
0.9% |
8.5% |
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|
20 |
-9 |
108 |
0.5% |
5.9% |
11.1% |
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|
21 |
131 |
3 |
-1.2% |
-1.6% |
0.2% |
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|
22 |
21 |
72 |
-0.1% |
2.7% |
8.5% |
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|
23 |
118 |
8 |
-0.5% |
7.3% |
6.7% |
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|
24 |
21 |
73 |
0.7% |
-4.4% |
-0.1% |
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|
25 |
56 |
35 |
-0.9% |
0.5% |
1.5% |
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|
26 |
136 |
2 |
-1.7% |
-1.0% |
0.3% |
||
|
27 |
31 |
64 |
-0.3% |
3.2% |
7.7% |
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|
28 |
49 |
43 |
-0.4% |
0.2% |
0.3% |
||
|
29 |
112 |
9 |
-0.6% |
6.8% |
7.1% |
||
|
30 |
47 |
47 |
0.2% |
3.8% |
8.1% |
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|
31 |
-11 |
113 |
0.5% |
4.8% |
8.1% |
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|
32 |
-20 |
128 |
0.2% |
3.1% |
5.3% |
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|
33 |
142 |
1 |
-1.2% |
-0.7% |
-0.7% |
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|
34 |
48 |
44 |
-0.7% |
-1.2% |
-1.6% |
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|
35 |
41 |
50 |
-0.3% |
-2.3% |
-0.9% |
||
|
36 |
93 |
14 |
-0.2% |
0.7% |
2.5% |
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|
37 |
13 |
84 |
0.5% |
5.8% |
7.9% |
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|
38 |
41 |
51 |
-1.0% |
1.0% |
1.6% |
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|
39 |
-20 |
132 |
0.1% |
1.5% |
6.0% |
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|
40 |
54 |
37 |
-0.6% |
-0.2% |
0.3% |
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The top 20 leading industries are plotted in Figure 1. It appears that synthetics and home furnishing stores had a sudden rise that needs investigating.
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FIGURE 1
1.1 Stocks in Leading Industries
The synthetics companies that trade an average of at least 200,000 shares per day and not traded over the counter are listed in Table 1B. Similar stocks for the home furnishing industry are listed in Table 1C. Those for the home health care industry are listed in Table 1D. Leaders for the past week and month have the lowest numbered rankings.
Table 1B - Synthetics
Table 1C – Home Furnishing
Table 1D – Home Health Care
Symbols that are highlighted in blue are optionable. Normally, the Options Advisory limits itself to stocks priced above $30 because the higher a stock’s price, the smaller percentage change is needed to produce a desired change in the value of an options contract.
Before trading any of these stocks, some due diligence is needed to look at their charts and the fundamentals that you typically use. These tables were obtained with tools available on the website, as well. The tools can be used to produce similar tables for any or all of the leading industries above or the lagging industries in Table 2A and Figure 2 below.
2.0 Lagging Industries
Lagging industries for the past month are listed in Table 2A. A chart showing the rank performance of the 20 worst ranked is shown in Figure 2.
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Table 2A
Lagging Industries
May 18, 2007
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Rank |
Relative To Avg. Position |
Rank of Position Change |
Lagging Industries |
Companies |
Last Gain |
1 wk Ago Gain |
1 mo Gain |
|
176 |
-17 |
123 |
-0.6% |
0.8% |
-1.3% |
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|
177 |
-113 |
213 |
-0.1% |
2.6% |
-0.5% |
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|
178 |
-90 |
208 |
0.3% |
1.5% |
-0.2% |
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|
179 |
-35 |
155 |
0.0% |
1.2% |
-1.8% |
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|
180 |
-58 |
189 |
-1.2% |
-1.9% |
-6.8% |
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|
181 |
-13 |
119 |
1.5% |
3.7% |
1.4% |
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|
182 |
-63 |
194 |
-0.5% |
-0.2% |
-1.3% |
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|
183 |
-73 |
202 |
0.5% |
2.0% |
-0.7% |
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|
184 |
-56 |
184 |
0.0% |
-0.5% |
-3.2% |
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|
185 |
-32 |
148 |
0.3% |
1.1% |
-0.3% |
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|
186 |
-65 |
195 |
0.2% |
2.1% |
-2.8% |
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|
187 |
-62 |
193 |
-0.1% |
0.6% |
-1.7% |
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|
188 |
-73 |
204 |
1.0% |
0.7% |
-4.6% |
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|
189 |
-32 |
149 |
0.1% |
2.3% |
-0.2% |
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|
190 |
-41 |
163 |
-0.6% |
-3.8% |
-3.5% |
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|
191 |
-49 |
178 |
-0.7% |
-6.4% |
-8.1% |
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|
192 |
-56 |
186 |
0.5% |
-10.2% |
-6.1% |
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|
193 |
-91 |
209 |
0.1% |
1.8% |
-1.1% |
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|
194 |
-66 |
196 |
0.4% |
2.2% |
-0.8% |
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|
195 |
-13 |
121 |
-0.7% |
-3.0% |
-9.6% |
||
|
196 |
-41 |
166 |
0.5% |
3.2% |
-4.6% |
||
|
197 |
-37 |
160 |
-0.4% |
1.9% |
-3.8% |
||
|
198 |
-34 |
153 |
-0.1% |
-6.9% |
-8.0% |
||
|
199 |
-67 |
198 |
-0.7% |
2.0% |
-4.0% |
||
|
200 |
-73 |
203 |
1.2% |
2.0% |
-1.1% |
||
|
201 |
-81 |
207 |
-0.1% |
-0.6% |
-2.4% |
||
|
202 |
-46 |
172 |
-0.5% |
2.2% |
-5.8% |
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|
203 |
-22 |
134 |
-0.7% |
-3.5% |
-3.5% |
||
|
204 |
-42 |
167 |
0.1% |
-5.6% |
-2.2% |
||
|
205 |
-66 |
197 |
-0.4% |
-4.9% |
-3.9% |
||
|
206 |
-4 |
104 |
-0.3% |
-6.1% |
-6.1% |
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|
207 |
-182 |
215 |
0.3% |
-9.9% |
-10.8% |
||
|
208 |
-11 |
115 |
-0.6% |
-17.0% |
-13.9% |
||
|
209 |
-148 |
214 |
0.4% |
-25.6% |
-21.5% |
||
|
210 |
-48 |
174 |
1.5% |
3.8% |
-14.1% |
||
|
211 |
-112 |
212 |
0.4% |
-21.0% |
-20.5% |
||
|
212 |
-102 |
211 |
-0.7% |
-30.5% |
-29.0% |
||
|
213 |
-6 |
105 |
-0.7% |
4.4% |
-44.4% |
||
|
214 |
-98 |
210 |
0.2% |
-51.5% |
-51.3% |
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|
215 |
-51 |
180 |
1.8% |
7.1% |
-50.8% |

FIGURE 2
3.0 Industries Rising in Rank
Table 3 contains the industries that are moving up in position the fastest. The 20 fastest rising in rank are plotted in Figure 3.
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Table 3
Industries Advancing in Rank the Fastest
May 18, 2007
|
Rank |
Relative To Avg. Position |
Rank of Position Change |
Fastest Advancing Industries |
Companies |
Last Gain |
1 wk Ago Gain |
1 mo Gain |
|
33 |
142 |
1 |
-1.2% |
-0.7% |
-0.7% |
||
|
26 |
136 |
2 |
-1.7% |
-1.0% |
0.3% |
||
|
21 |
131 |
3 |
-1.2% |
-1.6% |
0.2% |
||
|
51 |
130 |
4 |
-1.6% |
-1.1% |
-1.7% |
||
|
2 |
129 |
5 |
-0.5% |
39.7% |
31.2% |
||
|
68 |
121 |
6 |
-2.4% |
-2.3% |
-3.9% |
||
|
10 |
119 |
7 |
-0.1% |
3.4% |
3.6% |
||
|
23 |
118 |
8 |
-0.5% |
7.3% |
6.7% |
||
|
29 |
112 |
9 |
-0.6% |
6.8% |
7.1% |
||
|
17 |
110 |
10 |
-0.2% |
10.9% |
10.7% |
||
|
79 |
109 |
11 |
-1.9% |
-2.6% |
-4.4% |
||
|
66 |
97 |
12 |
0.2% |
6.2% |
5.9% |
||
|
13 |
96 |
13 |
-0.3% |
4.6% |
7.0% |
||
|
36 |
93 |
14 |
-0.2% |
0.7% |
2.5% |
||
|
18 |
88 |
15 |
0.1% |
6.4% |
6.8% |
||
|
4 |
81 |
16 |
-0.3% |
15.0% |
18.9% |
||
|
74 |
78 |
17 |
-0.4% |
-0.8% |
-3.3% |
||
|
14 |
77 |
18 |
-0.3% |
-0.6% |
4.3% |
||
|
5 |
76 |
19 |
0.0% |
7.7% |
10.4% |
||
|
43 |
75 |
20 |
-1.2% |
1.0% |
3.2% |
||
|
41 |
70 |
21 |
-0.9% |
-1.6% |
-2.4% |
||
|
16 |
70 |
22 |
0.2% |
4.0% |
10.8% |
||
|
86 |
69 |
23 |
0.3% |
-0.1% |
-1.1% |
||
|
48 |
68 |
24 |
0.0% |
0.6% |
0.7% |
||
|
19 |
68 |
25 |
0.0% |
0.9% |
8.5% |
||
|
58 |
67 |
26 |
-0.1% |
1.3% |
-1.0% |
||
|
60 |
67 |
27 |
0.0% |
3.3% |
6.1% |
||
|
12 |
64 |
29 |
0.3% |
4.9% |
2.3% |
||
|
54 |
64 |
28 |
0.0% |
3.5% |
2.5% |
||
|
77 |
64 |
30 |
-0.4% |
0.9% |
4.7% |
||
|
3 |
63 |
31 |
0.2% |
15.4% |
17.7% |
||
|
75 |
58 |
32 |
0.4% |
1.0% |
-0.2% |
||
|
135 |
58 |
34 |
1.0% |
-1.3% |
-3.6% |
||
|
49 |
58 |
33 |
-0.4% |
3.2% |
4.4% |
||
|
25 |
56 |
35 |
-0.9% |
0.5% |
1.5% |
||
|
1 |
56 |
36 |
1.2% |
43.4% |
41.4% |
||
|
40 |
54 |
37 |
-0.6% |
-0.2% |
0.3% |
||
|
6 |
52 |
38 |
1.2% |
6.4% |
6.2% |
||
|
90 |
52 |
39 |
-0.1% |
0.5% |
3.7% |
||
|
11 |
51 |
40 |
-1.2% |
-0.6% |
4.3% |

FIGURE 3
4.0 Industries Falling in Rank
A list of the industries declining in rank the fastest looks similar in Table 4. The 20 fastest declining in rank are plotted in Figure 4.
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Table 4
Industries Declining in Rank the Fastest
May 18, 2007
|
Rank |
Relative To Avg. Position |
Rank of Position Change |
Fastest Declining Industries |
Companies |
Last Gain |
1 wk Ago Gain |
1 mo Gain |
|
80 |
-49 |
176 |
0.5% |
4.0% |
5.5% |
||
|
172 |
-49 |
177 |
0.0% |
1.4% |
-1.7% |
||
|
191 |
-49 |
178 |
-0.7% |
-6.4% |
-8.1% |
||
|
103 |
-50 |
179 |
-0.3% |
1.0% |
2.4% |
||
|
215 |
-51 |
180 |
1.8% |
7.1% |
-50.8% |
||
|
127 |
-54 |
181 |
-0.8% |
1.2% |
1.7% |
||
|
114 |
-55 |
182 |
-0.6% |
-0.6% |
-1.2% |
||
|
155 |
-55 |
183 |
0.0% |
0.9% |
0.3% |
||
|
184 |
-56 |
184 |
0.0% |
-0.5% |
-3.2% |
||
|
96 |
-56 |
185 |
0.3% |
5.2% |
4.9% |
||
|
192 |
-56 |
186 |
0.5% |
-10.2% |
-6.1% |
||
|
174 |
-57 |
188 |
0.1% |
0.5% |
0.4% |
||
|
163 |
-57 |
187 |
0.1% |
-0.6% |
1.2% |
||
|
180 |
-58 |
189 |
-1.2% |
-1.9% |
-6.8% |
||
|
162 |
-61 |
190 |
0.3% |
0.1% |
-3.9% |
||
|
171 |
-61 |
191 |
-0.1% |
1.8% |
1.2% |
||
|
167 |
-61 |
192 |
1.2% |
1.8% |
1.6% |
||
|
187 |
-62 |
193 |
-0.1% |
0.6% |
-1.7% |
||
|
182 |
-63 |
194 |
-0.5% |
-0.2% |
-1.3% |
||
|
186 |
-65 |
195 |
0.2% |
2.1% |
-2.8% |
||
|
194 |
-66 |
196 |
0.4% |
2.2% |
-0.8% |
||
|
205 |
-66 |
197 |
-0.4% |
-4.9% |
-3.9% |
||
|
199 |
-67 |
198 |
-0.7% |
2.0% |
-4.0% |
||
|
143 |
-70 |
199 |
-0.2% |
1.2% |
-0.1% |
||
|
161 |
-71 |
200 |
-0.2% |
2.9% |
1.7% |
||
|
137 |
-73 |
201 |
0.2% |
2.0% |
1.9% |
||
|
183 |
-73 |
202 |
0.5% |
2.0% |
-0.7% |
||
|
200 |
-73 |
203 |
1.2% |
2.0% |
-1.1% |
||
|
188 |
-73 |
204 |
1.0% |
0.7% |
-4.6% |
||
|
148 |
-77 |
205 |
-0.7% |
0.7% |
-2.8% |
||
|
141 |
-81 |
206 |
0.2% |
-0.1% |
-2.9% |
||
|
201 |
-81 |
207 |
-0.1% |
-0.6% |
-2.4% |
||
|
178 |
-90 |
208 |
0.3% |
1.5% |
-0.2% |
||
|
193 |
-91 |
209 |
0.1% |
1.8% |
-1.1% |
||
|
214 |
-98 |
210 |
0.2% |
-51.5% |
-51.3% |
||
|
212 |
-102 |
211 |
-0.7% |
-30.5% |
-29.0% |
||
|
211 |
-112 |
212 |
0.4% |
-21.0% |
-20.5% |
||
|
177 |
-113 |
213 |
-0.1% |
2.6% |
-0.5% |
||
|
209 |
-148 |
214 |
0.4% |
-25.6% |
-21.5% |
||
|
207 |
-182 |
215 |
0.3% |
-9.9% |
-10.8% |

FIGURE 4
|
The important thing to note is that the usefulness of industry rankings depends on how each industry is actually performing. When the market performs poorly, the leading industry could very well be the one that declines the least. An industry could be doing nothing price wise but could end up near the top or bottom of the ranking list because other industries might be doing extremely poorly or well. There is not enough information in an industry’s ranking list alone to infer how the industry index has actually changed over time. Given the average industry performance or the percent change of the top and bottom ranked industries, one can only estimate how each of the remaining industries have performed. There is no substitute for looking at the actual percentage change of an index for the industry of interest.
Industries ranked according to how much their rank positions have changed from their average is a strong indicator of future industry leadership. This indicator also confirms how well a leading industry is maintaining its position.
The spreadsheet from which the charts and tables were obtained is available as a free download. It is named the “industries” spreadsheet and is obtained by clicking on the Excel Files link. XLQPlus is required. The industries spreadsheet gives you performance values for all 215 industries on a single page. The “companies” spreadsheet is downloaded for free from the same web page.
|
____________________________
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Stock-Signal-Pro Scans up to 5 watch lists of 100 stocks using predefined technical screens, flags which stocks are most favorable for market entry, provides entry price and charts, indicates strength of market direction and provides buy and sell signals. Free historical database.
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