The Option Investor Newsletter Wednesday 03-19-2003 Copyright 2003, All rights reserved. 1 of 2 Redistribution in any form strictly prohibited. In Section One: Wrap: Not So Calm Before the Storm Futures Wrap: Overbought Index Trader Wrap: Home on the Range Weekly Fund Family Profile: The World Funds, Inc. Options 101: So, You Want To Know The Future? Updated on the site tonight: Swing Trader Game Plan: Bulls Still In Charge Posted online for subscribers at http://www.OptionInvestor.com ******************************************************************* MARKET WRAP (view in courier font for table alignment) ******************************************************************* 03-19-2003 High Low Volume Advance/Decl DJIA 8265.45 + 71.22 8277.64 8141.50 1706 mln 1086/585 NASDAQ 1397.07 - 3.48 1401.24 1378.57 1679 mln 712/924 S&P 100 444.84 + 4.46 445.48 437.72 totals 1798/1509 S&P 500 874.02 + 7.57 874.99 861.21 RUS 2000 368.51 + 0.51 368.56 365.10 DJ TRANS 2149.15 + 20.13 2151.01 2121.02 VIX 36.18 + 0.40 36.39 34.87 VIXN 48.20 + 0.18 49.51 47.62 Put/Call Ratio 0.74 ******************************************************************* Not So Calm Before the Storm by Steve Price With just hours to go before the deadline set by the U.S. for Saddam Hussein to leave Iraq, or face military action, the markets showed plenty of indecision early on. The techs found sellers following Oracle's cautious guidance, while the Dow headed higher, building on gains of the previous five sessions. However, it wasn't long before war jitters took some shine off the recent gains and bulls took some profits. There have been may theories offered for the recent rise in the markets. I've heard that shorts began covering last week at the conclusion of head and shoulders objectives and then institutional money flowed in this week when war became imminent. I've heard there was selling into the rallies overseas in case a war does not go as quickly as some are predicting. I've heard plenty of explanations, but it is interesting that with all the reasons offered for movement, the recent movement continues to find pivotal technical levels as support and resistance. Granted, his morning's rally was fighting an uphill battle after disappointing guidance accompanying Oracle's earnings release on Tuesday night, but we did head into the green, stopping only at levels that have continued to play a big part in the movement over the past several months. We can conclude that the Dow, OEX and SPX did form classic bearish head and shoulders formations from October through January, resulting in a breakdown that fulfilled their objectives last week. Our big bounce came when the OEX and SPX hit their bearish objectives almost to the point. Now that we have bounced much higher, we have run right into bearish resistance on the point and figure charts. Those charts show bearish resistance in the Dow at 8300, SPX at 870 and OEX at 442.50 (on the 2.5 point box), while the OEX traditional chart registers that resistance at 448. Today's highs came in at Dow 8277, SPX 874.99 and OEX 445.48. We broke above that resistance on a closing basis in the SPX and OEX and fully through it in the OEX on the 2.5 point chart, although we are right up against it on the traditional chart. The SPX top at 874.99 came within 0.01 of a breakthrough. The next box level is required for a complete breakthrough, as can be seen on the chart below. Daily Chart of the Dow Point and Figure Chart of the SPX The Nasdaq struggled to hold the achievement of the 1400 level it made on Tuesday pretty much from the open. After Oracle said demand had softened near the end of the third quarter (fiscal) due to anxiety over a war in Iraq, calling it a "wild card" for customer demand, the reminder that the economy is still in neutral weighed across most of the techs sectors. What was also a concern was that some of the profits that the company posted were due to some outside issues, such as unusual cost of service savings and currency translation to U.S. dollars and even the estimate beat for the past quarter suddenly looks less convincing. In the afternoon rally that took the Dow, SPX and OEX all to new highs, the COMP was still unable to hold its late day test of 1400, eventually falling to 1397 on the close. Chart of the COMP In the area of conundrum, we got some results from Bear Stearns that further muddy the equity waters. Financial stocks are a good place to start any rally - or any market drop. BCS actually seems to have found the best of both worlds. It released earnings that beat expectations, citing record profits from its bond trading operations. Those operations turned into a big winner as investors fled the stock market and shifted back into fixed income instruments. So if financial stocks are turning profits on a market decline, will they lead us higher? Keep n eye on the BKX, BIX and XBD as we get earnings tomorrow morning from Goldman Sachs, Lehman and Morgan Stanley. Those indices have all bounced over the past week along with the broader markets, but are within points of their 50-dmas, which coincide with resistance from early and mid-February. Speaking of bonds, it appears that much of last week's rally was fueled by asset allocations between treasuries and stocks. Watching yields, which are a good indicator for where stocks are headed as they trade inversely to bonds (as bond prices rise, the yields from the purchase of those bonds drops and vice versa), also gave us a good indication of a possible market bottom last week. In fact, while the equities were testing July lows, and the bond market was rallying with the cash flow out of equities and into treasuries, yields had already dropped below July levels. The yields also took out their December and November lows and headed toward October levels. It was when the yield hit the October low that the broad markets all bounced. A look at the weekly chart of the ten-year note index shows big reversal off that level. Now that we are on the upside, we are also seeing some key levels tested by the yield. The five and ten year yields both broke above their 50-dmas on Tuesday and then gapped higher to start the day on Wednesday. The early indications from those 50-dma breaks are bullish. However, we are also entering some heavy resistance on both yield charts that could be tough to break. That could indicate a reallocation back in the other direction and should put bulls on alert. Chart of the Ten Year Yield One of the other indicators that I often use is the Market Volatility Index (VIX). The VIX has been a reliable indicator of market bounces and pullbacks at its extremes. Readings of 40% have indicated it is time for an equity bounce and readings of 34-35% have indicated it is time for a market pullback. The last decisive breakthrough of these levels came in January, when the VIX was finding resistance at 35%, rather than support and eventually took out that resistance on the head and shoulders neckline break between Dow 8200 and 8300, depending on how you draw the neckline (I have it at 8220). We have now rallied all the way back into that territory and once again the VIX is testing 35%. If we do manage to breakthrough the recent bottom, it will likely coincide with a move back above Dow 8300. The first close below 8300 was the domino that signaled a trip much lower and a close back above it may signal a true reversal higher. However, note that a trade of 8350 will be required to break through the bearish resistance line noted above on the point and figure chart. What is interesting here is the divergence in the VIX from the action in the equities. Although we saw a VIX decline early in the day, it was higher once again by the close, in spite of late day gains in the equities. Usually we see the opposite and it was the second time this week we've seen this divergence. Obviously, there are plenty of institutions holding up premium levels in the OEX that are still concerned about the downside possibilities that a messy war could bring, or the possibility that the rally is not for real. While the VIX is at the low end of the recent range, it is still historically high and if the big boys really thought we were headed higher, I would expect them to take advantage of the high levels of premium by shorting them. Chart of the VIX The crude oil futures, which have also been a reliable indicator of equity action, with a consistent inverse relationship, continued to drop further again today. Certainly if the oil fields in Iraq began flaming, we could see a reversal in that market, where the per barrel price has fallen 21% since March 12. I heard an analyst yesterday commenting that a drop in the price of oil from $31 per barrel to $24 could amount to a 1% increase in GDP from the fuel cost savings to Americans and U.S. businesses. That would seem to support the consistency we have seen in the inverse relationship between the equities and oil prices. Let's see, what have I left out? Oh, yes, the bullish percents. The bullish percents - the number of stocks giving point and figure buy signals in a particular index - have all been in free fall mode since the middle of January. That is until the past couple of days. Each prior rebound attempt was not quite enough to turn these indicators higher and they remained in oversold territory in the Dow, SPX and OEX, with the NDX just making it to the oversold line at 30%. In the past couple of sessions we have finally seen a rebound that was strong enough to reverse some of the indicators. The Dow bounced from a reading of 10% all the way up to a reading of 20%. The NDX bounced from 30% to 44% and the SPX which tends to lag because of the amount of stocks in the index, has now bounced from 28% to 34%. Those bounces should be a warning sign to bears and may indicate the beginning of a move higher, rather than an exhaustion of a bear market rally. While I am not ready to declare the bear market over, since these also reversed up on other bear market rallies, I am conscious of the fact that this bear market rally may still have some legs left in it. The rebounds from July and October took these percents up to 60% and 72% in the Dow; 50% and 82% in the NDX; and 58% and 68% in the SPX. So there is plenty of upside to this indicator if we are able to continue the breakout. Once all of these reached oversold territory, the risks began to shift out of the bears favor and now that they are on their way up, they are no where close to overbought at 70%. Bullish Percent of the Dow So we now have a number of technical indicators all converging at the current levels. The VIX, the bond market, the bearish resistance lines, the head and shoulders breakdown levels - all testing just how much strength the bulls have left after a gain of almost 900 Dow points in 6 sessions. Combine that with the possible start of a war in the next day or two and it appears that the spring is wound awfully tight right now. We saw bulls in charge in the major indices, but the techs unable to overcome the Oracle news. If the U.S. launches an attack tonight after the 8 p.m. deadline passes we should have a clearer picture of just whether the pre-war rally will stick. So far, it appears we will get a quick war - that is if today's unsolicited surrender of 17 Iraqi soldiers is any indication. There were also reports that the U.S. had already conducted air strikes on Iraq artillery that boosted the market late in the day. If the rally does stick, then traders who have been on the sidelines may want to go long if we complete those bearish resistance breakthroughs and a move above resistance in the yields I highlighted above. If we fade, then a higher level of support that doesn't reverse the bullish percents back down may also be a long entry point. However, defining a pullback will be tough and we have to remember that we have yet to see an economic recovery. After six straight up days in the Dow there is bound to be a pullback at some point, but wait for that pullback to show some support before jumping in long. If the rally isn't for real, traders may find themselves picking one bottom after another, all the way back to last week's levels Trade what you see, and keep your risk level comfortable. ************ FUTURES WRAP ************ Overbought Wednesday, March 19, 2003 By Vlada Raicevic Daily Settlement Numbers 4:15pm ET Contract Last Net High Low Dow 8265.45 +71.22 8277.64 8141.50 YM 03M 8236 +66 8256 8116 Nas 100 1074.98 -7.21 1083.11 1058.81 NQ 03M 1075.50 -12 1097.50 1062 S&P 500 874.02 +7.57 874.99 861.21 ES 03M 872.75 +6.50 874.50 860.25 Daily Pivots Contract S2 S1 Pivot R1 R2 YM 03M 8071 8166 8211 8306 8351 NQ 03M 1042.25 1058 1077.75 1093.50 1113.25 ES 03M 855.81 865.63 870.06 879.88 884.31 The last few days I’ve been keeping an open mind about the recent rally. Daily charts continued to be bullish even though shorter term charts were getting overbought and straining under bearish divergences. Now, as we look at the daily charts we see that they too, have reached overbought status. The term overbought tends to be thrown around quite a bit, and the meaning of it has been watered down a bit. To be overbought means to reach an extreme of one particular sentiment. However, just like some favorite uncle can turn beet red and puffy from too much brandy, there is no point in calling it a night until his drinking causes him to fall over. When you think he can’t swallow one more glass, he fools everyone and fills it up again. So, saying that we’ve reached overbought doesn’t mean we stop going up, it just means that conservative traders are moving out of their longs into a neutral position because of the possibility of a pullback. The depth of that pullback is the unknown. Today’s trading was mostly rangebound, moving back and forth across the Pivot at 865, to find resistance at the halfway area between Pivot and R1 at 869, and then finding support halfway between Pivot and S1 at 861. The end of the day saw a bullish surge and subsequent failure at the R1, 874 area. To my eyes, that last push upward lacked a certain attitude of reckless bullish abandon that we’ve been seeing lately. If I were to read into it I would say that all the war rally talk, and strong bullishness has started to take its toll and that the last gasp today was exhaustion buying. The ES daily: Stochastic is higher than it was at anytime during the Oct-Jan run. The same is true for CCI and RSI. In fact, CCI(32) hasn’t been this high since March 2002. We are also against very strong resistance at SPX 875, and strong resistance together with overbought conditions are a good mix for selling. However, we are not in anything resembling a normal market, or a normal world in general. It is fine and good to analyze past technicals in these charts to current levels, but we must remind ourselves that as crazy as the markets normally are, they can become absolutely insane when extreme pressure is exerted through outside influences like war. How ES traded on the Pivot Chart: ES 270 Minute All Sessions Chart: Note the divergences, Macd trendline break, and falling off of buying on the ADX, however, again there was almost no selling, although D- is now at extreme lows. Note how at the end of the day the price closed under the two trendlines forming strong resistance at 874.50. ES 60 minute Chart: What we have here is a rising wedge, which often fails to the downside. There is no more room to fluctuate, the wedge must now break either up or down. While down is the expected, watch out for a breakout above as a trap. However a breakout above actually holds (no reversal) then this can be seen as very bullish. ES 15 Minute Chart: Large View ES 15 Minute Chart: Closeup NQ daily is a little less bullish than the ES. It broke briefly below yesterdays lows, and did not close near the highs like the ES and YM did. Indicators have ceased their move up and are now pausing, but have not rolled over to indicate a possible move down. NQ 270 Minute All Sessions Chart: Compared to the ES, which is still holding bullish, the NQ has broken. It has moved outside its rising trendline after forming bearish divergences on all indicators. Uptrend lines on RSI, ADX and Macd have broken. After the break of the trendline, price has moved up to retest it from underneath, but it has affected the indicators. NQ 60 Minute Chart: Price broke sideways out of the rising trendline, but is now riding along the center of a support line of the regression channel. It also looks to be forming a rising wedge (shown in yellow), with another run to 1090-1100 a possibility, if we move up from this area. Note that RSI and Macd have not yet crossed below the centerline, so bias is still somewhat bullish on the 60 minute time frame. Renko Charts. These will be updated when necessary. Daily Renko for ES: Daily Renko for NQ: Daily Renko for YM: This one is a little more difficult. I set the box size to 5 rather than 2, and I don’t display the huge climb from the recent rally (it would take up most of the chart). With the larger box size, the absolute numbers have a slightly larger margin of error. ******************** INDEX TRADER SUMMARY ******************** Home on the Range Jonathan Levinson The markets treated us to a relatively calm day of rangebound trading with no surprises other than the lack of any surprises. We saw an extension of the trading range that has held across the indices, leading nowhere fast and causing traders to wonder whether we're looking at a consolidation/continuation pattern here at the highs, or a gradually forming top. Today's action occurred despite a nearly continuous stream of rumors concerning the war, surrenders of troops, captures and defections of heads of state, etc. Following Joe Granville's view that "news is noise", we'll analyze the relatively orderly market action seen today. Treasuries continued to sell off, with yields up strongly on the day, no doubt assisted by the fed's reverse repurchase agreement in the amount of $1.25B. Despite the movement of money out of t- bills, however, equities traded within a predictable range throughout the day. A late afternoon surprise had the indices print new highs on a 5 minute candle bearish ascending wedge, with the exception of the COMPX and QQQ which were unable to surpass the morning highs. The COMPX and QQQ notably unperformed the other indices, failing to print new highs toward the close, perhaps a sign of things to come after outperforming their peers during the past months. Volume was respectable but lighter than yesterday at 1.72V NYSE shares and 1.67B COMPX shares. Volatility was slightly higher, with the VIX adding .4 to close at 36.18, QQV +.64 to 42.69 and VXN +.18 to 48.20. Despite the gains on the day, volatility was higher, which is a divergence we've been observing throughout the week. Without zooming in on the subatomic (5 minute candle) charts, the end of day push printed an ascending or rising wedge on the indices. Chart patterns are not infallible, but according to Bulkowski in the "Encyclopedia of Chart Patterns", this formation tends to break lower roughly 75% of the time. Suffice it to say that the move to the day highs was not done in a healthy manner, and leaves the indices set up on a short term basis for a weaker open, or a push higher within the formation followed by a pullback or breakdown out of the 5 minute candle formation shortly thereafter. On to the charts: The INDU is trading on buy signals across the indicators I follow but stopped in a significant resistance zone. While the close above the widely-watched 8250 was significant, it's far from out of the woods with resistance all the way up to the 61.8 fib retracement off the March low, which falls at 8314.37. Next resistance is at 8506.12, followed by 8869.30. Support below is at the 50% line, at 8142.95, then 7971.53, 7779.78 and 7416.6. While the oscillators are in bull runs, note that the stochastics are getting toppy, and the volume has been dropping off throughout the week. Combined with the positive VIX today, these indicators should have bulls snugging up their stops to protect profits. The SPX showed us similar action today, closing right at critical resistance below the 875 line. Fib resistance is just above at 879.19, again from the 61.8% retracement line off the March lows. Fib support is below at 861.95, then at 844.71. We see again the toppy but still bullish stochastics, declining volume as price advances, and VIX divergence today. The OEX closed at 444.84, just below its 61.8% retracement line which resides at 446.50. Support is below at 437.66, then at 428.83, 418.95 and 400.24. Resistance above is 446.50, 456.38 and 475.09. As noted above, the COMPX lagged the INDU, SPX and OEX today, and the results are clearest on the candle pattern and stochastics. While candlesticking is not my specialty, the closing print appears to me to be a bearish doji star, which is a topping formation indicating indecision. The stochastics are closer than those of the INDU, SPX and OEX to giving a bearish cross. As well, the lighter volume today confirms the indecision and lack of follow-through at the top, and, lastly, the COMPX closed negative, down 3.43 on the day at 1397.10. Resistance is above at 1402, followed by the 61.8% retracement at 1413.78. Support is at 1385, 1360.25, 1334.99, 1306.72 and 1253.20. The QQQ is the most bearish of the bunch, with the stochastic oscillator having given a sell signal with a bearish cross from overbought, and closing the most negative of the indices above. Note that the high reported appears to be a bad print, as I would remember having seen a print of 27.76 at some point. Resistance is at 26.84, followed by 27, followed by 27.47. Support below is at 26.49, 26.33, 25.97, 25.04, 24.52 and 23.54. Aside from the indicators discussed above, the leading weakness in the QQQ should have bullish traders cautious. I am not suggesting shorting this market with abandon, because the events of the past week have shown that caution is the only appropriate strategy. I'm not suggesting going long either for the reasons seen above. There are buy signals on the charts, but others are telling us that this rally is showing signs of weakness and potential reversal. Whatever you choose to do, do it defensively and use stops. With geopolitical event risk at relative highs and no one, from Chairman Greenspan on down to the pundits in the media, can predict the consequences thereof. War has gone from being bullish to bearish and back again, with the interpretation of the news changing almost with each passing hour. Treat it as noise and follow your charts, but above all, protect your capital. Traders are getting their accounts blown out in this environment, and if you're finding it difficult, tricky or treacherous, you're not alone. ************************Advertisement************************* Tired of waiting on trades to execute? Does your broker offer Stop Losses on Options? Trade instantly with Stop Losses at PreferredTrade Inc. Stop Losses based on the option price or the stock price. Move your trading into the next millennium with PreferredTrade. Anything else is too slow! http://www.PreferredTrade.com/CF/Home.CFM?ID=OIN ************************************************************** ************************** WEEKLY FUND FAMILY PROFILE ************************** The World Funds, Inc. The World Funds is a mutual fund that consists of six separate series with combined assets of $240 million. Each of the fund series has its own investment objective, strategy and separate portfolio. The fund series currently available are as follows: CSI Equity Fund (CSIIX) CSI Fixed Income Fund (CSIDX) Genomics Fund (GENEX) Third Millennium Russia Fund (TMRFX) Sand Hill Portfolio Manager Fund (SHPMX) The New Market Fund (AVMIX) Three of the World Funds' offerings are currently available on a no-load NTF basis through Schwab's OneSource program: CSI Equity (CSIIX), Genomics Fund (GENEX), and Third Millennium Russia Fund (TMRFX). Note, however, that each series has a "redemption" fee of 1.0% or 2.0% on shares sold within a year. Four series have a low minimum initial investment of $1000. The Genomics Fund requires a $5000 initial minimum, while New Market Fund (AVMIX) has a $25,000 minimum initial purchase requirement. So, the New Market Fund may be out of reach for most individuals. CSI Capital Management serves as investment advisor on two World Fund series - Equity Fund (CSIIX) and Fixed Income Fund (CSIDX). xGENx LLC serves as the investment advisor on the Genomics Fund (GENEX). The Third Millennium Russia Fund (TMRFX) portfolio is managed by Third Millennium Investment Advisors. The Sand Hill Portfolio Manager Fund (SHPMX) is run by Sand Hill Advisors and the New Market Fund (AVMIX) is managed by the London Company of Virginia. For complete information, or to download a prospectus, go to the World Funds' website at www.worldfundsonline.com. There you can find more details on management fees, expenses, and special risk considerations associated with each series of the fund. Fund Overview Perhaps the two most "plain vanilla" offerings in the fund are the CSI Equity Fund and CSI Fixed Income Fund. Both funds are managed by Leland Faust of CSI Capital Management, the firm he founded in 1978. The Equity Fund seeks long-term appreciation through investments in a diversified portfolio of common stock, primarily well established, large-cap companies located in the U.S. and abroad. Leland utilizes a blend of "value and growth" investment strategies in the security selection process. The CSI Fixed Income seeks current income by investing in debt securities. Such securities may include obligations issued or guaranteed by the U.S. government and U.S. government agencies, authorities and instrumentalities. It may also invest in muni- debt securities, corporate debt securities, zero coupon bonds, and obligations of foreign governments, corporations and other entities. Leland is also the portfolio manager of this series. The GenomicsFund is a specialty-healthcare offering that seeks capital appreciation through investments in a "non-diversified" portfolio, primarily equity securities of companies, which are engaged in genomics or genomic-related businesses (normally at least 80% of assets). Because the offering operates as a "non- diversified" fund under the Investment Company Act of 1940, it may hold a larger portion of its assets in a smaller number of securities. Commonwealth Capital Management is the investment advisor to the fund. In the interest of limiting fund expense, Commonwealth has assumed the fund's existing expense agreement from xGENx LLC. Like the Genomics Fund, the Third Millennium Russia Fund seeks capital appreciation by investing in a non-diversified, common stock portfolio. John Conner with Third Millennium Investment Advisors LLC and Alexei Molkvin with ROSGAL are co-managers of the fund series. Under normal conditions, the fund invests at least 80% of its assets in equity securities, and convertibles, of companies located in Russia. Suffice to say, investment in Russian securities involve substantial risk and are considered "highly speculative." But, as Barton Biggs (of Morgan Stanley) once told me, you have to willing to go places others won't if you want the opportunity to make big money. The Sand Hill Portfolio Manager Fund seeks to maximize returns through investment in a diversified portfolio of stocks, bonds and money market instruments on a "global" basis. In managing assets, the fund seeks to minimize the tax burden to investors. Jane Williams, who founded Sand Hill Advisors, Inc., has served as the portfolio manager since fund inception in 1995. She may invest (without limit) in each of these three asset classes and may invest a varying proportion of assets in foreign securities. So, this offering has a "go-anywhere" style. The sixth series of the World Funds, Inc., The New Market Fund, seeks to achieve long-term growth of capital by investing in a portfolio composed of common stocks and securities convertible into common stock (i.e. warrants, convertible bonds, debentures and convertible preferred stock). Stephen Goddard, president and principal shareholder of The London Company of Virginia, has been the fund's portfolio manager since its 1998 inception. The fund is "non-diversified." As you can probably tell by now, some of the series of the World Fund, Inc. are unique in their strategy, offering investors ways to further diversify their investment portfolio. Genomics Fund, for instance, is the only fund of its kind specializing in genes. The Third Millennium Russia Fund is the only mutual fund that we know of that specializes principally in Russian stocks. Risk is higher in these two offerings, but theoretically so is potential return. In the next section, we see how well the World Funds, Inc. funds have performed over various time periods relative to their peers (as categorized by Morningstar). Investment Performance Since each of the six series of the World Fund Inc. have existed for at least three years, they all have Morningstar return, risk and overall, risk-adjusted ratings. Only three series have been around five years, long enough to experience some good times, as well as bad times (since 2000). Below is a performance summary as of March 18, 2003 for the three World Funds' series with at least five years of history. Average Annual Return/Morningstar Category Ranking: + 3.9% CSI Equity Fund (CSIIX) 2nd Percentile +10.0% CSI Fixed Income Fund (CSIDX) 1st Percentile - 3.6% Sand Hill Portfolio Manager Fund (SHPMX) 52nd Percentile Here you can see the fine job that Leland Faust has done with the two CSI portfolios. The Equity Fund produced a 5-year annualized total return of 3.9% for investors, ranking in the 2nd percentile of the Morningstar large-cap blend stock fund category. The fund was able to capture some of the returns available during the bull market of the late 1990s and posted a positive return in the year 2000 as other equity funds began to falter. Since 2001, his fund has lost ground but Leland has done a better job than other funds of preserving capital. The result, a positive 5-year return, and a 2nd percentile ranking. Note that Lipper categories the Equity Fund as a "global" fund. The CSI Fixed Income Fund has a 10% average annual return for the 5-year period, ranking in the 1st percentile of the international bond fund category per Morningstar. Note, however, that the fund is categorized as a "corporate A-rated debt" fund by Lipper so it is somewhat of bond fund hybrid, investing in both U.S. bonds and foreign debt securities. Nonetheless, an equity-like 10% return. The Sand Hill Portfolio Manager Fund has lost an average of 3.6%/ year over the past five years, ranking in the middle of the large blend category per Morningstar. In the past year, the series has held up better than the U.S. stock market (S&P 500 index) ranking in the top decile of the Morningstar large-blend category. It is "global flexible portfolio" in Lipper's system. The Third Millennium Russia Fund (TMRFX) struggled in 2000 but in years 1999, 2001, 2002 and YTD 2003 it knocked home runs, ranking no worse than 3rd percentile in the Morningstar Europe stock fund category. The result, a 3-year annualized loss of just 0.9%, and a category ranking in the top decile (2nd percentile). In 99, it produced a staggering 145% total return, then dropped in value by 29% in 2000. That should provide a feel of how well (poorly) the fund series can perform in any given year. By the end of 2000 it had people running for the exits, but the strategy has since come back strongly. Conclusion True to its name, World Funds Inc., the six series have "global" mandates. Although some funds land in the Morningstar large-cap blend category, they may invest a sizeable portion of assets in foreign securities. Thus the term "global flexible" may be more appropriate for these six offerings. If you're invested primarily in U.S. securities and funds, these funds may play a "supporting" role in your portfolio. Among the available options, we like the job that Leland Faust has done on the CSI Equity Fund and the CSI Fixed Income Fund. Both of them have performed very well over the past five years in relation to their category peers (per Morningstar). For more information, go to the www.worldfundsonline.com website. Steve Wagner Editor, Mutual Investor email@example.com *********** OPTIONS 101 *********** So, You Want To Know The Future? by Mark Phillips mphillips@OptionInvestor.com Hey, me too! In all seriousness, for those of you that don't tune into the Market Monitor during the day, tonight's article will be another installment of me donning my "Great Carnac" hat and gazing into my crystal ball. I received an email requesting just that this afternoon, and when I inquired in the Monitor about whether there was any interest, the response was overwhelming. Wow! I fell like Sally Field, "You like me, you really like me!" HUGE GRIN The nature of the question I received is "What do I see for the markets, looking out over the next 3-6 months, assuming the Iraq conflict goes according to "script", whatever that means. That seemed like a good question to me, as the markets have lately been locked into the All-Iraq, All-The-Time theme. Economics, earnings, and anything other than geopolitical news is being ignored. We all know that fog will clear in the very near future -- at least we hope it does. And our job is to try to look out past the Gulf conflict to try to determine where our beloved markets are headed next. So let's get to it shall we. Never mind the chanting in the background, that's just me entering my predictive trance. Alright, enough bad jokes. Here we go. First, let's start with some background. The last time I delved into this topic was on January 6th, when I started a two-part discussion on my prognostications for the coming year. If you missed those articles, then feel free to take a look at those articles at the links below. 'Tis The Season http://www.OptionInvestor.com/traderscorner/tc_010603_1.asp 'Tis The Season, Part II http://members.OptionInvestor.com/options101/opt_010803_1.asp In that discussion (for those that don't want to take the time to read the old stuff), was my prediction that the broad markets would actually avoid the dreaded 4th consecutive down year. Additionally, I pointed to the likelihood that the NASDAQ would perform better than the rest of the market, due in large part to the fact that most of the punishment has already been meted out to Technology stocks, while there is still a fair amount of excess to be wrung out of the rest of the market. That second point has certainly turned out to be true over the past couple months, as the NASDAQ Composite (COMPX) bottomed last week well above its October lows, finding support at the 1260 level once again. A simple relative strength chart comparing the COMPX to the S&P 500 (SPX.X) bears this out quite clearly. Relative Strength Chart of the COMPX vs. SPX See how the RS chart bottomed in December of last year at a significantly higher level than that seen in October? That looks very good for my premise of outperformance for the Technology sector of the market. We can get another view of this strength by just looking at the chart of the COMPX, shown below. Daily Chart of the NASDAQ Composite - COMPX As you can see, the COMPX is still mired within the descending channel (red lines) that has been building for nearly two years now. But isn't it interesting how this index has been consistently finding support above the center line (gray line) of that channel for the past few months? Add in this week's breakout over both the 50-dma and the 200-dma and the COMPX looks like it might have some room to run if it can clear near-term resistance in the 1400-1425 area. So does this mean we can just go out and buy LEAP calls on the QQQ and let it ride into the end of the year? Maybe, but I have a lot of reservations. You see, the COMPX looks bullish on a technical basis right now, but the technicals are only one part of this equation. A big reason the COMPX looks so good right now is that it (and the rest of the market) are in the process of rebounding from a severe oversold condition. So what are the other components we need to pay attention to, when trying to divine the direction of the market? Fundamentals and Sentiment. First, let's deal with the issue of sentiment. Since the middle of January, the market has been fixated on the looming war in Iraq, with a tremendous amount of uncertainty being priced into the market. That has created the oversold condition that we are now recovering from. Over the past week, this oversold condition has been unwinding rather rapidly, as traders have attempted to front-run what they expect will be a powerful post-conflict rally, using the 1991 Gulf War as the template. So you see, while technicals have certainly played a role, the decline and subsequent rally since early December has been predominantly driven by changing sentiment -- first pessimistic and now optimistic. Here's the big potential problem though. The current rally in the market is predicated on a relatively smooth operation in Iraq. In my opinion, that means a conflict that is measured in the 2-4 week timeframe, with the absence of large numbers of U.S. casualties and Saddam not resorting to the use of weapons of mass destruction. That is the scenario that is currently priced into the market, along with the unspoken assumption that after the war is out of the way, the economy will recover smartly into the end of the year. Aaahhh, now there is that pesky issue of fundamentals that we've avoided up to this point in our conversation. This is also the part of the equation that is currently being ignored by the market in hopes that it will get better after the war is over. If I was to detail my thoughts on the state of the economy (which is really what fundamentals for the market boil down to right now), I could probably fill another 15-20 pages, discussing things like the trade balance, currency concerns, interest rates, unemployment, inflation vs. deflation, the housing market, the retail environment, the price of oil and the outlook for gold. Fortunately for me, I don't need to write that thesis, as Buzz Lynn has done an excellent job of that over the past couple months. Buzz and I don't necessarily agree on everything, but we are pretty much on the same page with respect to the economic outlook both here in the U.S. and for the global economy. If you haven't read his series, I highly recommend it. Here are the links for your convenience. Joining The Fray http://members.OptionInvestor.com/options101/opt_010903_1.asp To Inflate or Deflate - That is the Question http://members.OptionInvestor.com/options101/opt_011603_1.asp To Inflate or Die - That is the Second Question http://members.OptionInvestor.com/options101/opt_012303_1.asp Real Estate 2003 - Boon or Bubble? http://members.OptionInvestor.com/options101/opt_013003_1.asp Gold http://members.OptionInvestor.com/options101/opt_020603_1.asp Now that you're back from reading that dissertation on the state of the economy, let's look at where we are right now. Interest rates are still at multi-decade lows and unlikely to move up any time soon. In fact the economic picture is so uncertain that at this week's FOMC meeting, Alan Greenspan declined to even issue a statement on the economic risks. I think there are two possibilities here: either the Fed chief doesn't know what to make of the current economy (i.e. doesn't have a clue) or sees something ugly on the horizon that he doesn't want to disclose to the public as the country heads to war. Neither option sounds very encouraging to me. I find the recent developments in the Housing market to be interesting too. On numerous occasions over the past year, Greenspan has forcefully stated that the housing market is NOT in a bubble like that which the equity markets are still dealing with. So isn't it curious that with sharp declines in the housing reports for the past two months, the Fed chief warned that we should expect weakness in the housing and refinancing markets this year? It doesn't take a genius to see that the economy has been propped up over the past couple years by the cycle of refinancing, the proceeds of which have been used to fund consumption. But with interest rates at multi-decade lows, and not likely to go much lower, the incentive for another refi is dramatically reduced. Translation: the gravy train that has been propping up the economy in the vacuum left behind when businesses stopped spending looks like it has run its course. The trade imbalance is looking uglier by the month, auto sales are falling and unemployment is rising. Even after the pullback in the past several days, energy prices are still quite elevated. This equates to a direct tax on both the consumer and business. For every extra dollar the consumer has to pay for energy, that's a dollar that is unavailable to drive economic growth. Similarly, that increased fuel cost increases the cost for energy-intensive businesses to produce what they produce. In a normal economic environment, companies would simply raise prices to maintain profit margins. But they can't do that right now, as there is a glut of supply and a shortage of demand. So what we have is a consumer with fewer dollars to spend on products produced by Corporate America, intensifying the competition (read: price competition) for those discretionary dollars that are in circulation. This competitive cycle in the business world is global, and China is exporting deflation to the world, due to its ability to produce "stuff" cheaper than anyone else. The weakness in the dollar just feeds that cycle, as China's currency is tied to the dollar. So as the dollar weakens, China's goods are cheaper on the global market, intensifying the pricing pressures on domestic companies. I could go on and on about this topic, but what it boils down to is there is not a definable engine for growth in the economy, either in the U.S. or worldwide. So what does any of this have to do with the imminent war in Iraq? Actually nothing, but what is key is that market participants have been ignoring all the economic problems over the past week in the hope that when the smoke clears in Iraq, consumers and businesses will go back on a spending spree. Call me a cynic, but I say that dog won't hunt. Record levels of debt (for consumers, businesses and governments) mean that more and more revenue is being used to service that debt. That means it isn't going to be used to fuel economic growth. Investors seem to be dancing to the 1991 game plan, where the markets embarked on a strong rally following the start of the first Gulf War. But I see the underlying conditions as very different this time around. Even if the conflict in Iraq goes smooth as glass, when it is all over, investors will be confronted with an S&P 500 P/E ratio (based on core earnings) of about 40, and a dividend yield of less than 2% in a stagnant economy. Those numbers for P/E ratio and dividend yield are typical of bull market tops, not bear market bottoms. There are only two ways to bring those two metrics in line with what is typical near a bear market bottom - earnings and dividend payouts need to rise or stock prices need to fall. I think I've made a pretty good case above that growing earnings over the next year is going to be a Herculean task for most companies, as there just isn't anything to drive growth to the bottom line. Six weeks from now, we'll be looking at the April earnings cycle in the rear-view mirror and while it may not be a disaster, it isn't likely be strong enough to usher in a new bull market -- not even a cyclical one. At the same time, early May will usher in the "bad" 6 months of the year (May-October) that are usually least kind to stock market bulls. I've made no secret of my opinion that we haven't seen the bottom of this bear market, by any stretch of the imagination. But I think it is going to be a very interesting path between here and the bottom. Over the near-term, we're likely to continue the rally that is currently underway, provided there aren't any nasty surprises related to the war effort. The bullish percent charts will likely continue their trek from oversold territory, back up to overbought and we'll be ready to repeat the process. I've frequently referred to the descending channel that the SPX has been mired in for the past few years. That channel shows no signs of being broken anytime soon, in large part because there isn't a sufficient fundamental catalyst to get the job done. The top of that channel is at the 950 level right now, which is very near the highs in both November and January. I expect the top of that channel to once again deflect this rally downwards, if it gets that far. Therein lies the problem with my prognostication from January, though. You see, if you project this channel out to the end of the year, the top of that channel will be at 750!! There's certainly no way the SPX can remain in the channel AND close positive for the year, now is there? So either, it has to break out of that channel, or my guess for a positive close for the year is WAY off. I think before we ring in another new year, the SPX will indeed break and hold above the top of that descending channel, but the path isn't going to be pretty. My view is that after the fog of war has been cleared from our collective viewscreen and we once again focus on the economy, the market will have no choice but to head back to the south, breaking below the October lows in the process. We ought to find a bottom on that decline near the 700 level, probably sometime in the latter part of the summer. I'm basing my timeframe on the latest cycle from low to high to low, which took just about 5 months. Five months from now will have us closing in on the end of August. It isn't an exact science, by any stretch of the imagination, but I think it ought to work for the purposes of our discussion. Note that at the end of August, the center line of that descending channel will have fallen to about 675, and we will really need to see it hold as support, for the subsequent rebound. If the SPX actually trades that low, I think the spring will actually be coiled tightly enough to propel the SPX out of its channel and we should be in the process of actually starting to build a bottom. A couple of other metrics that we'll want to start watching for at that time will be for the 50-dma and 200-dma to bottom, then turn up, and for the 50-dma to cross above the 200-dma. Once the SPX pushes through both of these upturned moving averages, I'll be happy to chant "The bulls are back in town". It may not be the start of a new Bull Market (I expect that event is still a few years off), but it could be time for a serious advance that results in the upside break of that channel. For a picture of what that will look like, all you have to do is look at the COMPX daily chart up above. Actually, the COMPX isn't quite there yet, as both moving averages are still pointed south. But with price now over both averages, we can start the process of at least flattening them out...with enough time. The process of turning those moving averages around will help to break the COMPX out of its descending channel, just like we expect at a later date from the SPX. Let's summarize based on the three major factors I mentioned above. Sentiment is in control right now, more appropriately termed, "fear of missing the next rally". When the war fades from our view, we'll be forced to confront the reality of our economy for what it is. Without some earth-shaking good news in the April earnings cycle, investors are going to lose their appetite for being long stocks. Then the technicals will come into play with a vengeance, just like at the end of each of the prior bear market rallies, and we'll get another big drop. I feel the action in the VIX will be particularly interesting, but we just don't have the time to go into it tonight. So if you're bearish, don't fret. There will be another major rollover in the market that we can play for all it's worth. And for the bulls, my recommendation would be to focus your efforts in the NASDAQ stocks, as that is where the relative strength currently is. The blow-by-blow of what to expect each week will be dependent on the developments in the bullish percents and the technical price action. But more up, then more down and finally a big push up at the end of the year, is where I see this great game shaking out. It may not be enough to prove me right on a positive close for the year, but I'm willing to bet the COMPX will close well into the 'plus' column. That's all the Great Carnac has for tonight. Have a great evening and we'll talk again over the weekend. Mark ************************Advertisement************************* If you trade options online, then you need an online broker that: offers true direct access to each option exchange offers stop and stop loss online option orders offers contingent option orders based on the price of the option or stock offers online spread order entry for net debit or credit offers fast option executions PreferredTrade offers these online option trading features and more; call 1-888-889-9178 or click for more information. http://www.PreferredTrade.com/CF/Home.CFM?ID=OIN ************************************************************** *********************** SWING TRADER GAME PLANS *********************** Bulls Still In Charge After a day of mostly churning, the bulls once again took control. If there was any doubt as to why we are rallying, a late day surge on the rumor that the U.S. had already begun bombing Iraqi artillery positions across the border from Kuwait answered any questions. To read the rest of the Swing Trader Game Plan Click here: http://www.OptionInvestor.com/itrader/indexes/swing.asp ************************Advertisement************************* ”If you haven’t traded options online – you haven’t really traded options,” claims author Larry Spears in his new compact guide book: “7 Steps to Success – Trading Options Online”. Order today and save 25% (only $15) by clicking on PreferredTrade and clicking on the link to the book on its home page. http://www.PreferredTrade.com/CF/Home.CFM?ID=OIN ************************************************************** ******************* FREE TRIAL READERS ******************* If you like the results you have been receiving we would welcome you as a permanent subscriber. The monthly subscription price is 39.95. The quarterly price is 99.95 which is $20 off the monthly rate. We would like to have you as a subscriber. You may subscribe at any time but your subscription will not start until your free trial is over. 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The Option Investor Newsletter Wednesday 03-19-2003 Copyright 2003, All rights reserved. 2 of 2 Redistribution in any form strictly prohibited. In Section Two: Stop Loss Updates: None Dropped Calls: None Dropped Puts: BAC, XL Play of the Day: Call -BCR Big Cap Covered Calls & Naked Puts: Investors Remain Cautious Amid War Worries! Updated on the site tonight: Market Posture: Techs Anchor Rally Market Watch: Running of the Bulls ************************Advertisement************************* Tired of waiting on trades to execute? Does your broker offer Stop Losses on Options? Trade instantly with Stop Losses at PreferredTrade Inc. Stop Losses based on the option price or the stock price. Move your trading into the next millennium with PreferredTrade. Anything else is too slow! http://www.PreferredTrade.com/CF/Home.CFM?ID=OIN ************************************************************** ***************** STOP-LOSS UPDATES ***************** None ************* DROPPED CALLS ************* None ************ DROPPED PUTS ************ BAC $69.50 +1.16 (+2.19 for the week) We tightened our stop in BAC after the broad market rebound took many of the financials with it. The stock followed the other banks higher today, after Bear Stearns released earnings results that beat expectations. The additional profits came from the fixed-income trading side, after investors switched out of stocks. It was enough to lift the Bank Indices (BIX and BKX), which carried BAC along for the ride and through our stop. WE are letting this one go, but trader's who'd like to give it more room can use a stop just above $70. --- XL $70.21 +1.02 XL bounced after at one point registering a $5 move in our favor. It continued to fail at $70 on multiple attempts, and we lowered our stop to $70.06. The first time it tested $70 and failed, it rolled over hard and provided a nice entry point for the play, however, this time it has hung in and now closed above our adjusted stop. We are letting this one go with the show of strength above $70. If we do get a pullback in the morning trader's can use it to exit, although if the stock breaks down below its 21-dma at $67.99 before finding support, then put holders may want to give it another chance. ************************Advertisement************************* If you trade options online, then you need an online broker that: offers true direct access to each option exchange offers stop and stop loss online option orders offers contingent option orders based on the price of the option or stock offers online spread order entry for net debit or credit offers fast option executions PreferredTrade offers these online option trading features and more; call 1-888-889-9178 or click for more information. http://www.PreferredTrade.com/CF/Home.CFM?ID=OIN ************************************************************** ********************** PLAY OF THE DAY - CALL ********************** BCR - C. R. Bard, Inc. $61.05 +1.31 (+2.65 this week) Company Summary: C. R. Bard, Inc. is engaged in the design, manufacture, packaging, distribution and sale of medical, surgical, diagnostic and patient care devices. Hospitals, physicians and nursing homes purchase used once and discarded. BCR's major product group categories are: vascular diagnosis and intervention, urological diagnosis and intervention, and oncological diagnosis and intervention. In addition, the company maintains a fourth product group, surgical specialties. Why We Like It: The past few days have seen some impressive bullish action throughout the market, with many stocks in numerous sectors posting impressive upward moves. Many of those moves have seemed to be largely short-covering related, but we've got a new play tonight that is breaking out on what looks like good old-fashioned organic buying. The longer a stock takes to break out of a consolidation pattern, the more powerful that move tends to be. Well, BCR has been working its way higher since the July lows, with each rally being stopped by the $60 resistance level. But not this time. Monday's surge higher took BCR right to the edge of that resistance again, and then despite the broad market indecision on Tuesday, the bulls blasted through that level on strong volume. Closing just over the $61 and at the high of the day, BCR posted its best closing price since January of 2002. That move was good for a quad-top breakout on the PnF chart, and the bullish price target is now tentatively set at $74. BCR's all-time high is just shy of $65, so achieving that target will have the stock well into new high territory. Following such a strong breakout, it is entirely possible that BCR could continue to power higher. That means a continued breakout over today's highs (as long as volume remains strong) can be used for new momentum-based entries, using $61.25 as a trigger. Of course, the preferable entry point will come on a dip back to confirm the $59-60 area as newfound support. Place stops initially at $57.75, just below recent support. Why This Is Our Play of the Day: BCR added to its quad top breakout on the PnF chart today, but not before testing its breakout level as support. The stock dropped to $60.51, testing the level we referred to in last night's play write-up, giving traders who were looking to enter on a pullback a nice entry point, and then moved higher above our momentum entry trigger at $61.25. While BCR may react along with the broader markets to any war jitters, we like the show of support we got this morning after the decisive breakout on the point and figure chart. New entries can jump in at current levels, or more conservative traders can wait for a broad market pullback and hope to get a similar entry to this morning's just above $60. BUY CALL APR-60*BCR-DL OI=2246 at $2.20 SL=1.25 BUY CALL APR-65 BCR-DM OI= 70 at $0.35 SL=0.00 BUY CALL JUL-60 BCR-GL OI=1252 at $3.70 SL=2.00 BUY CALL JUL-65 BCR-GM OI= 38 at $1.50 SL=0.75 Average Daily Volume = 279 K ************************Advertisement************************* ”If you haven’t traded options online – you haven’t really traded options,” claims author Larry Spears in his new compact guide book: “7 Steps to Success – Trading Options Online”. Order today and save 25% (only $15) by clicking on PreferredTrade and clicking on the link to the book on its home page. http://www.PreferredTrade.com/CF/Home.CFM?ID=OIN ************************************************************** ********************************************* SPREADS, COMBINATIONS & PREMIUM-SELLING PLAYS ********************************************* Investors Remain Cautious Amid War Worries! By Ray Cummins Stocks edged higher today despite concerns over the length of the impending Iraqi conflict and the uncertain outlook for President Bush's $726 billion tax-cut plan. The Dow Jones industrials ended up 71 points at 8,265 on solid gains by Altria (NYSE:MO), Kodak (NYSE:EK), Citigroup (NYSE:C), Merck (NYSE:MRK), and J.P. Morgan (NYSE:JPM). In contrast, the technology composite slipped 3 points to 1,397 as semiconductor, Internet, and software and hardware shares kept the NASDAQ in the red. The S&P 500 index climbed 7 points to 874 with drug and bank shares enjoying selective buying interest while airlines, oil and biotechnology issues generally retreated. Advancers led declines 17 to 15 on the New York Stock Exchange and 16 to 15 on the NASDAQ. Trading volume was moderate with over 1.4 billion shares changing hands on the Big Board, while 1.7 billion shares were swapped on the technology exchange. The benchmark 10-year bond slumped 16/32 at 99 8/32 to yield 3.96%, up from 3.91% in the previous session. The 30-year treasury gave up 15/32 to yield 4.91%, up from 4.88%. *************** SUMMARY OF CURRENT POSITIONS - AS OF 3/18/03 *************** The following summary is a reasonable account of the positions previously offered in this section. However, no representation is being made as to the actual performance of a position and in fact, there are frequently large differences between the summary results and those of our subscribers, due to the variety of ways in which each play can be opened, closed, and/or adjusted. In addition, the summary might not be completely representative of the manner in which the average trader would react to changing conditions in a position and to the options market in general. The editor of this section does not take actual positions in any published plays and the summary comments are simply a service to help new traders understand when positions might be opened and closed. In most cases, actions taken based on the commentary would be far too late to be effective, thus it is not intended as a substitute for personal trade management nor does it in any way replace your duty to diligently monitor and manage the positions in your portfolio. MONTHLY YIELD FOR UNCOVERED OPTIONS: MAXIMUM & SIMPLE The Maximum Yield (listed in the summary and with "naked" option selling plays) is the greatest possible profit available in the position. This amount, expressed as a percentage, is based on the initial margin requirement as determined by the Board of Governors of the Federal Reserve, the U.S. options markets and other self-regulatory organizations. Although increased margin requirements may be imposed either generally or in individual cases by various brokerage firms, our calculations use the widely accepted margin formulas from the Chicago Board Options Exchange. The "Simple Yield" is based on the cost of the underlying issue (in the event of assignment), including the premium from the sold option, thus it reflects the maximum potential loss in the trade. Naked Puts ********** Stock Strike Strike Cost Current Gain Max Simple Symbol Month Price Basis Price (Loss) Yield Yield ANF MAR 25 24.40 30.21 $0.60 5.97% 2.46% CLX MAR 40 39.00 44.71 $1.00 5.01% 2.56% OTEX MAR 25 24.50 28.47 $0.50 4.97% 2.04% SYMC MAR 40 39.15 46.27 $0.85 5.10% 2.17% VIP MAR 30 29.40 37.09 $0.60 4.74% 2.04% ANF MAR 25 24.65 30.21 $0.35 4.66% 1.42% AVCT MAR 22 22.20 25.50 $0.30 4.59% 1.35% DISH MAR 22 22.00 30.06 $0.50 7.13% 2.27% IGEN MAR 30 29.50 33.80 $0.50 6.04% 1.69% PTEN MAR 30 29.45 33.39 $0.55 5.17% 1.87% RYL MAR 37 36.95 41.35 $0.55 4.42% 1.49% AVCT MAR 25 24.70 25.50 $0.30 4.78% 1.21% DISH MAR 22 22.15 30.06 $0.35 6.56% 1.58% NBR MAR 35 34.65 39.85 $0.35 4.30% 1.01% VLO MAR 35 34.60 40.96 $0.40 4.49% 1.16% CELG APR 22 21.25 26.10 $1.25 8.68% 5.88% ERES APR 20 19.20 25.68 $0.80 8.04% 4.17% LLTC MAR 27 27.15 34.65 $0.35 6.76% 1.29% MXIM MAR 30 29.70 39.84 $0.30 5.88% 1.01% SLAB MAR 22 22.30 29.84 $0.20 5.78% 0.90% XNLX MAR 20 19.75 26.93 $0.25 7.16% 1.27% Positions previously closed: Patterson-UTI (NASDAQ:PTEN); $32.50 strike, Noble (NYSE:NE) and BJ Services (NYSE:BJ), all of which are currently positive. Naked Calls *********** Stock Strike Strike Cost Current Gain Max Simple Symbol Month Price Basis Price (Loss) Yield Yield ESRX MAR 55 55.70 55.94 ($0.24) 0.00% 1.26% GM MAR 37 38.10 34.12 $0.60 4.60% 1.57% VIA MAR 40 40.95 38.60 $0.95 6.44% 2.32% CCMP MAR 50 50.55 45.72 $0.55 5.47% 1.09% KLAC MAR 40 40.50 38.13 $0.50 5.63% 1.23% QCOM MAR 40 40.45 39.25 $0.45 4.59% 1.11% VZ MAR 40 40.55 35.90 $0.55 4.73% 1.36% OMC MAR 60 60.55 54.49 $0.55 4.52% 0.91% QCOM MAR 37 37.85 39.25 ($1.40) 0.00% 0.92% * QLGC MAR 37 37.90 40.18 ($2.28) 0.00% 1.06% * COF APR 32 33.05 30.33 $0.55 5.56% 1.66% MERQ APR 35 35.80 34.59 $0.80 7.15% 2.23% PHM APR 50 51.10 49.65 $1.10 4.92% 2.15% The bearish positions in Qualcomm (NASDAQ:QCOM) and Qlogic (NASDAQ:QLGC) should have been closed last Friday for much smaller losses during the initial stages of the broad rally. Express Scripts (NASDAQ:ESRX) is also a candidate for early exit along with Capital One (NYSE:COF), Mercury Interactive (NASDAQ:MERQ) and Pulte Homes (NYSE:PHM). Put-Credit Spreads ****************** Symbol Pick Last Month L/P S/P Credit C/B G/L Status BHE 34.68 32.45 MAR 25 30 0.60 29.40 $0.60 Open PRX 33.67 40.00 MAR 25 30 0.40 29.60 $0.40 Open SLM 105.54 108.79 MAR 90 95 0.45 94.55 $0.45 Open EBAY 76.99 88.08 MAR 65 70 0.55 69.45 $0.55 Open CAT 45.95 49.80 MAR 40 42 0.25 42.25 $0.25 Open BRL 51.47 51.92 MAR 43 46 0.33 46.33 $0.33 Open AGN 63.82 69.25 MAR 55 60 0.50 59.50 $0.50 Open CTSH 69.62 65.14 MAR 60 65 0.60 64.40 $0.60 Open EOG 42.14 40.13 MAR 35 40 0.50 39.50 $0.50 Open LXK 62.82 64.97 MAR 55 60 0.70 59.30 $0.70 Open AMGN 55.33 58.87 APR 48 50 0.30 49.70 $0.30 Open NKE 46.48 48.99 APR 40 42 0.30 42.20 $0.30 Open Call-Credit Spreads ******************* Symbol Pick Last Month L/C S/C Credit C/B G/L Status CCU 36.70 36.36 MAR 45 40 0.75 40.75 $0.75 Open FDX 50.87 51.68 MAR 60 55 0.55 55.55 $0.55 Open UTX 60.50 61.75 MAR 70 65 0.60 65.60 $0.60 Open RD 39.56 40.31 MAR 45 43 0.25 42.75 $0.25 Open AZO 64.86 71.20 MAR 75 70 0.50 70.50 ($0.70) Closed MRK 52.10 53.02 MAR 60 55 0.55 55.55 $0.55 Open CTX 50.03 52.34 APR 60 55 0.60 55.60 $0.60 Open LEN 49.40 52.05 APR 60 55 0.55 55.55 $0.55 Open LEH 53.42 58.50 APR 65 60 0.55 60.55 $0.55 Open The bearish position in Autozone (NYSE:AZO) should have been closed during Monday's sharp rally. Centex (NYSE:CTX), Lennar (NYSE:LEN), and Lehman Brothers (NYSE:LEH) are on the "early exit" watch-list. Biogen (NASDAQ:BGEN) gapped down during the session after the position was offered, thus a credit near the target price was not available. Calendar Spreads (Reader's Request) *********************************** Stock Pick Last Long Short Current Max Play Symbol Price Price Option Option Debit Value Status APA 60.74 61.00 APR-65C MAR-65C (0.40) 1.10 Closed STJ 43.69 47.55 APR-45C MAR-45C 0.20 0.80 Closed Apache Oil (NYSE:APA) has been closed to protect gains. St. Jude Medical (NYSE:STJ) has also offered favorable "early-exit" profits. Credit Strangles **************** No Open Positions Synthetic Positions ******************* No Open Positions Questions & comments on spreads/combos to Contact Support ************** NEW POSITIONS This following group of plays is simply a list of candidates to supplement your search for profitable trading positions. As with any new investment, you must decide if the selections meet your criteria for potential plays. Only you can know what strategies are suitable for your personal skill level, risk-reward tolerance and portfolio outlook. In addition, we recommend that you avoid any trading techniques in which you are not completely comfortable with the potential capital loss, the necessary adjustments, and the common entry-exit strategies. The positions with "*" will be included in the weekly summary. Those with "TS" (Target-Shoot) are below our minimum monthly return, but may offer a favorable entry price with a limit order, due to the daily volatility of the underlying issue. ************** BULLISH PLAYS - NAKED PUTS All of these issues have robust option premiums and relatively favorable technical indications. However, current news and market sentiment will have an effect on these stocks, so review each play thoroughly and make your own decision about its future outcome. WARNING: THE RISK IN SELLING UNCOVERED OPTIONS IS SUBSTANTIAL! The sale of uncovered puts entails considerable financial risk, far more than the initial margin or collateral required to open a position. The maximum financial obligation for the sale of a naked put is the strike price (of the underlying stock) that is sold. Although this obligation is reduced by the premium from the sale of the option, a writer of puts should have the cash or collateral equivalent of the sold strike price in reserve at all times. In addition, there is one very important rule when using this strategy: Don't sell puts on stocks that you don't want to own! Why? Because stocks occasionally experience catastrophic declines, exponentially increasing the margin maintenance and possibly causing a devastating shortfall in your portfolio. It is also important that you consider using trading stops on naked option positions to help limit losses when a stock's price falls. Many professional traders suggest closing the position when the underlying share value moves below the sold strike, or using a "buy-to-close" stop order at a price that is no more than twice the original premium received from the sold option. *************** EXPE - Expedia $47.13 *** USAI Merger/Buyout! *** Expedia (NASDAQ:EXPE) is a provider of travel-planning services. The company's travel marketplace includes direct-to-consumer Websites offering travel-planning services located at Expedia.com, Expedia.co.uk, Expedia.de, Expedia.ca, Expedia.nl and Expedia.it. Expedia also provides travel-planning services through Voyages sncf.com, as part of a joint venture with the state-owned railway group in France. In addition, the company offers travel-planning services through its telephone call centers and through private label travel Websites through its WWTE business. WWTE is now a division of Travelscape, one of Expedia's primary subsidiaries. EXPE - Expedia $47.13 PLAY (sell naked put): Action Month & Option Open Last Cost Max. Simple Req'd Strike Symbol Int. Price Basis Yield Yield SELL PUT APR 40 UED PH 1,926 0.55 39.45 4.5% 1.4% * SELL PUT APR 42.5 UED PV 427 1.00 41.50 6.7% 2.4% SELL PUT APR 45 UED PI 0 1.65 43.35 9.1% 3.8% ************** GENZ - Genzyme General $36.27 *** New Disease Treatments! *** Genzyme General Division (NASDAQ:GENZ) is a division of Genzyme Corporation, a biotechnology and human healthcare company that develops products and provides services for unmet medical needs. Genzyme General develops and markets therapeutic products and diagnostic products and services with an emphasis on genetic disorders and other chronic debilitating diseases with defined patient populations. The company is organized into two segments, Therapeutics, which focuses on developing and marketing products for genetic diseases and other chronic debilitating diseases, including a family of diseases known as lysosomal storage disorders, and specialty therapeutics, and Diagnostic Products, which develops, markets and distributes in vitro diagnostic products. The company also operates a wholly owned subsidiary, GelTex Pharmaceuticals. GENZ - Genzyme General $36.27 PLAY (sell naked put): Action Month & Option Open Last Cost Max. Simple Req'd Strike Symbol Int. Price Basis Yield Yield SELL PUT MAR 35 GZQ OG 3,362 0.30 34.70 33.7% 0.9% SELL PUT APR 30 GZQ PF 2,056 0.40 29.60 4.7% 1.4% * SELL PUT APR 32.5 GZQ PP 443 0.75 31.75 6.6% 2.4% SELL PUT APR 35 GZQ PG 396 1.35 33.65 9.4% 4.0% ************** KLAC - KLA Tencor $39.27 *** Rally In Progress! *** KLA-Tencor (NASDAQ:KLAC) is a supplier of process control and yield management solutions for the semiconductor and related microelectronics industries. The company's large portfolio of products, software, analysis, services and expertise is designed to help integrated circuit manufacturers manage yield throughout the entire wafer fabrication process, from research and development to final mass production yield analysis. The company offers a broad spectrum of products and services that are used by every major semiconductor manufacturer in the world. These customers turn to the company for in-line wafer defect monitoring; reticle and photomask defect inspection; CD SEM metrology; wafer overlay; film and surface measurement; and overall yield and fab-wide data analysis. KLAC - KLA Tencor $39.27 PLAY (sell naked put): Action Month & Option Open Last Cost Max. Simple Req'd Strike Symbol Int. Price Basis Yield Yield SELL PUT MAR 37.5 KCQ OU 2,169 0.30 37.20 31.9% 0.8% SELL PUT APR 32.5 KCQ PZ 3,724 0.55 31.95 5.8% 1.7% * SELL PUT APR 35 KCQ PG 2,040 1.00 34.00 8.1% 2.9% SELL PUT APR 37.5 KCQ PU 385 1.70 35.80 11.0% 4.7% ************** MSFT - Microsoft $26.32 *** Entry Point? *** Microsoft (NASDAQ:MSFT) develops, manufactures, licenses and supports a wide range of software products for a multitude of computing devices. The company's software products include scalable operating systems for servers, personal computers and intelligent devices; server applications for client/server environments; information worker productivity applications; business solutions applications, and software development tools. During 2002, Microsoft launched Xbox, its next-generation video game system. The firm's online efforts include the MSN network of Internet products and services and alliances with companies involved with broadband access and various forms of digital interactivity. Microsoft licenses consumer software programs, sells hardware devices, provides consulting services and trains and certifies system integrators and developers. MSFT - Microsoft $26.32 PLAY (sell naked put): Action Month & Option Open Last Cost Max. Simple Req'd Strike Symbol Int. Price Basis Yield Yield SELL PUT APR 23.75 MQF PR 39,813 0.40 23.35 4.9% 1.7% * SELL PUT APR 25 MSQ PE 70,540 0.70 24.30 7.2% 2.9% SELL PUT APR 27.5 MSQ PY 31,656 1.90 25.60 14.2% 7.4% ************** BULLISH PLAYS - CREDIT SPREADS These candidates are based on the underlying issue's technical history or trend. The probability of profit in these positions may also be higher than other plays in the same strategy, due to small disparities in option pricing however, each play should be evaluated for portfolio suitability and reviewed with regard to your strategic approach and trading style. *************** ADBE - Adobe Systems $33.02 *** New Trading Range? *** Adobe Systems (NASDAQ:ADBE) builds software solutions for network publishing, including Web, print, e-paper, video, wireless and broadband applications. Its graphic design, imaging and dynamic media authoring tools enable customers to create, manage and deliver visually rich, reliable content. The company licenses its technology to hardware manufacturers, software developers and service providers, and it offers integrated software solutions to businesses of all sizes. Its software runs on Microsoft Windows, Apple Macintosh, Linux, UNIX, Palm OS and Pocket PC platforms and Adobe distributes its products through a network of distributors and dealers, value-added resellers, systems integrators and OEMs; direct to end users through Adobe call centers, and through its own Website, www.adobe.com. ADBE - Adobe Systems $33.02 PLAY (conservative - bullish/credit spread): BUY PUT APR-25.00 AEQ-PE OI=3534 A=$0.15 SELL PUT APR-30.00 AEQ-PF OI=506 B=$0.65 INITIAL NET-CREDIT TARGET=$0.50-$0.55 POTENTIAL PROFIT(max)=11% B/E=$29.50 ************** CMCSA - Comcast $29.91 *** On The Move! *** Comcast (NASDAQ:CMCSA) is a cable operator involved in three principal lines of business: cable, through the development, management and operation of broadband communications networks; commerce, through QVC, its electronic retailing subsidiary; and content, through its consolidated subsidiaries Comcast Spectacor, Comcast SportsNet, Comcast SportsNet Mid-Atlantic, Comcast Sports Southeast, E! Entertainment Television, The Golf Channel, Outdoor Life Network, G4 Media, and through other programming investments. The company has deployed digital cable applications and high-speed Internet service to most of its cable communications systems. CMCSA - Comcast $29.91 PLAY (conservative - bullish/credit spread): BUY PUT APR-25.00 CCQ-PE OI=2045 A=$0.35 SELL PUT APR-27.50 CCQ-PY OI=3365 B=$0.65 INITIAL NET-CREDIT TARGET=$0.30-$0.40 POTENTIAL PROFIT(max)=14% B/E=$27.20 ************** FRX - Forest Labs $53.10 *** New FDA Approval Upcoming? *** Forest Laboratories (NYSE:FRX) develops, manufactures and sells both branded and generic forms of ethical drug products that require a physician's prescription, as well as non-prescription pharmaceutical products sold over-the-counter. The company's most important U.S. products consist of branded ethical drug specialties marketed directly, or "detailed," to physicians by its Forest Pharmaceuticals, Therapeutics and Specialty sales forces. The company's many products include those developed by Forest and those acquired from other pharmaceutical companies and integrated into Forest's marketing and distribution systems. Principal products include Celexa, an SSRI for the treatment of depression; the respiratory products Aerobid and Aerochamber; Tiazac, a once-daily diltiazem for the treatment of hypertension and angina; and Infasurf, a lung surfactant for the treatment and prevention of respiratory distress syndrome in premature infants. FRX - Forest Labs $53.10 PLAY (less conservative - bullish/credit spread): BUY PUT APR-45.00 FHA-PI OI=923 A=$0.35 SELL PUT APR-50.00 FHA-PJ OI=744 B=$0.95 INITIAL NET-CREDIT TARGET=$0.60-$0.70 POTENTIAL PROFIT(max)=14% B/E=$49.40 ************** LXK - Lexmark Intl. $65.89 *** To The Top Of The Range! *** Lexmark International (NYSE:LXK) is a developer, manufacturer and supplier of printing solutions, including laser and inkjet printers, multifunction products and associated supplies and services for offices and homes. The company also markets dot matrix printers for printing single and multi-part forms for business users and develops, manufactures and markets a broad line of other office imaging products. LXK - Lexmark Intl. $65.89 PLAY (conservative - bullish/credit spread): BUY PUT APR-55.00 LXK-PK OI=914 A=$0.40 SELL PUT APR-60.00 LXK-PL OI=1640 B=$0.85 INITIAL NET-CREDIT TARGET=$0.45-$0.55 POTENTIAL PROFIT(max)=9% B/E=$59.55 ************** SLM - SLM Corporation $110.21 *** New 52-Week High! *** SLM Corporation (NYSE:SLM), formerly USA Education, is a private source of funding, delivery and servicing support for higher education loans for students and their parents in the United States. SLM provides a range of financial services, processing capabilities and information technology to meet the needs of educational institutions, lenders, students and guarantee agencies. The company's managed portfolio of student loans, including loans owned and loans securitized, totals over $70 billion, of which the majority is federally insured. The firm also has commitments to buy billions of dollars of additional student loans. Primarily a provider of education credit, the company serves a diverse range of clients, including over 6,000 educational and financial institutions and guarantee agencies. The company serves in excess of seven million borrowers through its ownership or management of student loans. SLM - SLM Corporation $110.21 PLAY (very conservative - bullish/credit spread): BUY PUT APR-95.00 SLM-PS OI=1776 A=$0.65 SELL PUT APR-100.00 SLM-PT OI=705 B=$1.00 INITIAL NET-CREDIT TARGET=$0.40-$0.50 POTENTIAL PROFIT(max)=8% B/E=$99.60 ************** SYNTHETIC POSITIONS ************** These stocks have momentum-based trends and favorable option premiums. Traders with a directional outlook on the underlying issues may find the risk-reward outlook in these plays attractive. ************** GGP - General Growth Properties $54.02 *** Rally Mode! *** General Growth Properties (NYSE:GGP) is the country's second largest shopping center owner, developer and manager of regional shopping malls. General Growth currently has ownership interests in, or management responsibility for, a portfolio of 160 regional shopping malls in 39 states. The company's real estate portfolio totals approximately 140 million square feet of retail space and includes over 16,000 retailers nationwide. GGP - General Growth Properties $54.02 PLAY (very speculative - bullish/synthetic position): BUY CALL APR-55.00 GGP-DK OI=198 A=$0.65 SELL PUT APR-50.00 GGP-PJ OI=184 B=$0.50 INITIAL NET DEBIT TARGET=$0.00-$0.05 INITIAL TARGET PROFIT=$0.45-$0.75 Note: Using options, the position is similar to being long the stock. The minimum initial margin/collateral requirement for the sold option is approximately $1,815 per contract. However, do not open this position if you can not afford to purchase the stock at the sold put strike price ($50). ************** BEARISH PLAYS - NAKED CALLS Based on analysis of option pricing and the underlying stock's technical background, these positions meet our fundamental criteria for bearish "premium-selling" strategies. Each issue has robust option premiums, a well-defined resistance area and a high probability of remaining below the target strike prices. As with any recommendations, these positions should be carefully evaluated for portfolio suitability and reviewed with regard to your strategic approach and personal trading style. WARNING: THE RISK IN SELLING UNCOVERED OPTIONS IS SUBSTANTIAL! The sale of uncovered calls entails considerable financial risk, far more than the initial margin or collateral required to open the position. The maximum financial obligation for the sale of a naked option is the strike price (of the underlying stock) that is sold. Although this obligation is reduced by the premium from the sale of the option, a writer of options must have the cash or collateral equivalent of the sold strike price in reserve at all times. The simple fact is: stocks often experience large price swings, exponentially increasing the margin maintenance and very possibly causing a devastating shortfall in your portfolio. It is also important that you consider using trading stops on naked option positions to help limit losses when a stock price moves in a volatile manner. Many professional traders suggest closing the position when the underlying share value moves beyond the sold strike, or using a "buy-to-close" stop order at a price that is no more than twice the original premium received from the sold option. *************** IGEN - IGEN International $33.38 *** Premium-Selling Only! *** IGEN International develops and markets products that incorporate its proprietary electrochemiluminescence (ORIGEN) technology, which permits the detection and measurement of various biological substances. ORIGEN provides a combination of speed, sensitivity, flexibility and throughput in a single technology platform. The product is incorporated into instrument systems and other related consumable reagents, and IGEN also offers assay development and services used to perform analytical testing. Products based on ORIGEN technology address the Life Sciences, Clinical Testing and Industrial Testing worldwide markets. IGEN - IGEN International $33.38 PLAY (sell naked call): Action Month & Option Open Last Cost Max. Simple Req'd Strike Symbol Int. Price Basis Yield Yield SELL CALL APR 45 GQ DI 1,247 0.55 45.55 7.7% 1.2% * SELL CALL APR 42.5 GQ DV 420 0.85 43.35 11.5% 2.0% SELL CALL APR 40 GQ DH 1,616 1.25 41.25 15.9% 3.0% ************** MCHP - Microchip Technology $21.50 *** Earnings Warning! *** Microchip Technology (NASDAQ:MCHP) develops and manufactures specialized semiconductor products used by its customers for a wide variety of embedded control applications. The company's product portfolio comprises field-programmable RISC-based microcontrollers that serve 8- and 16-bit embedded control applications, and a broad spectrum of high-performance linear and mixed-signal, power and thermal management devices. The company also offers complementary microperipheral products, including interface devices, serial EEPROMS, and its patented KEELOQ security devices. The firm markets its products to the automotive, communications, computing, consumer and industrial control markets. MCHP - Microchip Technology $21.50 PLAY (sell naked call): Action Month & Option Open Last Cost Max. Simple Req'd Strike Symbol Int. Price Basis Yield Yield SELL CALL MAR 22.5 QMT CX 7,056 0.15 22.65 29.4% 0.7% TS SELL CALL APR 25 QMT DE 5,914 0.40 25.40 7.4% 1.6% * SELL CALL APR 22.5 QMT DX 2,899 1.10 23.60 12.8% 4.7% ************** BEARISH PLAYS - CREDIT SPREADS All of these positions are favorable candidates for "bear-call" credit spreads, based on the current price or trading range of the underlying issue and its recent technical history or trend. The probability of profit from these positions may be higher than other plays in the same strategy, due to disparities in option pricing. However, current news and market sentiment will have an effect on these issues, so review each play individually and make your own decision about its future outcome. *************** BHI - Baker Hughes $30.13 *** Trading Range? *** Baker Hughes (NYSE:BHI) is engaged in the oilfield and process industries. The company also manufactures and sells products and provides services to industries that are not related to the oilfield or continuous process industries. The Oilfield segment consists of six operating divisions: Baker Atlas, Baker Hughes INTEQ, Baker Oil Tools, Baker Petrolite, Centrilift and Hughes Christensen. The company, through its Oilfield segment, is a supplier of wellbore-related products, technology services and systems and provides equipment, products and also services for drilling, formation evaluation, completion and production of oil and gas wells. The Process segment consists of two operating divisions: EIMCO Process Equipment and BIRD Machine. Through its Process segment, the Company manufactures, markets and services a broad range of separation and treatment solutions and continuous and batch centrifuges and specialty filters. BHI - Baker Hughes $30.13 PLAY (conservative - bearish/credit spread): BUY CALL APR-35.00 BHI-DG OI=5352 A=$0.20 SELL CALL APR-32.50 BHI-DZ OI=2573 B=$0.45 INITIAL NET-CREDIT TARGET=$0.25-$0.30 POTENTIAL PROFIT(max)=11% B/E=$32.75 ************** INTU - Intuit $50.44 *** Sell The Rally! *** Intuit (NYSE:INTU) is a provider of business tax preparation and personal finance software products and Web-based services that simplify complex financial tasks for consumers, small businesses and accounting professionals. The company's principal products and services include Quicken, QuickBooks, Quicken TurboTax, ProSeries, Lacerte and Quicken Loans. Intuit offers products and services in five principal business divisions, which include Small Business, Tax, Personal Finance, Quicken Loans and Global Business. INTU - Intuit $50.44 PLAY (conservative - bearish/credit spread): BUY CALL APR-60.00 IQU-DL OI=2892 A=$0.20 SELL CALL APR-55.00 IQU-DK OI=2431 B=$0.70 INITIAL NET-CREDIT TARGET=$0.55-$0.60 POTENTIAL PROFIT(max)=11% B/E=$55.55 ************** OMC - Omnicom $53.96 *** Downtrend Intact? *** Omnicom Group (NYSE:OMC) is a worldwide marketing and corporate communications company. Omnicom has grown its strategic holdings to over 1,500 subsidiary agencies operating in over 100 countries. The firm's wholly and partially owned businesses provide a range of communications services to clients on a global, pan-regional and national basis. The company's agencies provide an extensive variety of marketing and corporate communications services, as well as advertising, brand consultancy, crisis communications, custom publishing, database management, digital and interactive marketing, direct marketing, directory and business-to-business advertising, employee communications and environmental design. Omnicom also provides field marketing, healthcare communications, marketing research, media planning and buying, multi-cultural marketing, non-profit marketing, promotional marketing, public affairs, public relations, recruitment communications, specialty communications and sports and event marketing. OMC - Omnicom $53.96 PLAY (conservative - bearish/credit spread): BUY CALL APR-65.00 OMC-DM OI=1017 A=$0.25 SELL CALL APR-60.00 OMC-DL OI=1896 B=$0.70 INITIAL NET-CREDIT TARGET=$0.50-$0.60 POTENTIAL PROFIT(max)=11% B/E=$60.50 ************** SEE DISCLAIMER - SECTION 1 ************** ************** MARKET POSTURE ************** Techs Anchor Rally To Read The Rest of The OptionInvestor.com Market Watch Click Here http://www.OptionInvestor.com/marketposture/mp_031903.asp ************ MARKET WATCH ************ Running of the Bulls To Read The Rest of The OptionInvestor.com Market Watch Click Here http://members.OptionInvestor.com/watchlist/wl_031903.asp ******************* FREE TRIAL READERS ******************* If you like the results you have been receiving we would welcome you as a permanent subscriber. The monthly subscription price is 39.95. The quarterly price is 99.95 which is $20 off the monthly rate. We would like to have you as a subscriber. 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