BUY: GW (AMEX), TCK (NYSE), RAIL (NASDAQ), ASPV (NASDAQ), AVR (NYSE)

All total transaction prices include a $15.00 commission.

• Purchased 400 shares of Grey Wolf, Inc. (GW) at $8.60/share = $3,455.00.
• Purchased 77 shares of Teck Cominco Limited (TCK) at $44.97/share = $3,477.69.
• Purchased 68 shares of FreightCar America, Inc. (RAIL) at $50.13/share = $3,423.84.
• Purchased 180 shares of Aspreva Pharmaceuticals Corporation (ASPV) at $19.32/share = $3,492.60.
• Purchased 230 shares of Aventine Renewable Energy Holdings, Inc. at $14.78/share = $3,414.40.

Transaction summary:

• Total transaction costs: $17,263.53
• Final bank account: $139.67

Portfolio:

• HRB: 109
• CLMT: 79
• FCX: 46
• FDG: 82
• XJT: 378
• DLX : 112
• ASEI : 49
• INTX : 265
• CECO: 113
• CRYP: 148
• UIC: 49
• CONN: 105
• HGT: 102
• WIRE: 117
• IPS: 27
• SHOO: 81
• IIIN: 138
• LMS: 82
• KSWS: 70
• WON: 338
• TTES: 175
• ALDA: 172
• EGY : 502
• OPMR: 314
• USMO: 135
• GW: 400
• TCK: 77
• RAIL: 68
• ASPV: 180
• AVR: 230

Total "account value" including cash is $94,248.41. The number a couple of months ago was 88,280.20 meaning that in theory things are moving along at a nice clip; this means that to-date second-year returns are 6.7% and overall increase since the start of 25.7%. Internet is unavailable to me as I write this, but I understand that P/E on the S&P is around 17+ x some very high earnings, so pricing is moving to the fringe of being related to reality. When the US economy does go boom, it may well be joined by China's, meaning instant recession. If the broader economy continues growing, prices will certainly continue the upward climb for a while. This can’t go on indefinitely, though, and probably within a year prices will have fallen below the current level. I think shifting ramping the market cap cut-off from $50 million to $1.5 billion would be wise over the next year. Bigger companies will suffer less when the contraction comes. That’s a consideration for a methodology with a one-year holding horizon.

From the start of Year 2, changes on the indices are:

• Dow: 12,961.98 -> 13,360.76: up 3.1%.
• S&P 500: 1,484.35 -> 1,502.56: up 1.2%.
• NASDAQ composite: 2,526.39 -> 2,588.96: up 2.5%.
• TSE 300: 12,171.29 -> 13986.03: up 14.91%

From the start of Year 1, changes on the indices are:

• Dow: 11,278.7695 -> 13,360.76: up 18.5%.
• S&P 500: 1,309.93 -> 1,502.56: up 14.7%.
• NASDAQ composite: 2,370.8799 -> 2,588.96: up 9.2%.

SELL: MOT, PWEI, PPD, HNR, ANIK

Sold Motorola on the 18^th to keep the capital loss; remainder on June 19 for the long-term capital gain. Including commissions of $15.00 per transaction, here are the sale results:

• 133 MOT x $18.13 = $2,396.29. Short-term capital loss: $289.35 = -11.4%
• 254 ANIK x $15.60 = $3,947.40. Long-term capital gain: $1,245.08 = 46.1%
• 90 PWEI x $33.41 = $2,991.90. Long-term capital gain: $317.40 = 12.7%
• 217 HNR x $12.97 = $2,799.49. Long-term capital gain: $98.03 = 3.6%
• 78 PPD x $63.71 = $4,954.38. Long-term capital gain: $2,271.78 = 84.7%
• MOT's total annual dividends paid out: $26.60 = 0.99%
• PWEI's total annual dividends paid out: $21.40 = 0.8%

Totals:

• Net short-term capital gain (loss): ($289.35)
• Net long-term capital gain (loss): $3,932.29
• Net proceeds for this group: $3,642.94
• Net return for this group: 27.09%

Finally, numbers to keep around:

• Bank account: $17,403.20
• Accumulated short-term capital gain (loss) so far: ($1,323.50)
• Accumulated long-term capital gain (loss) so far: $7,653.47
• Total realized capital gain (loss): $6,329.97
• Total dividends paid out: $48.00
• Total realized gain (loss): $6,377.97
• Total cost of stocks sold: $25,518.40
• Total realized return: 24.99%