THE STOCKS IN EACH PORTFOLIO are ranked each week from the strongest (1) to the weakest (36). The strongest ranks tend to continue to rise much farther and faster in future price than the weakest. Take this example of JDS Uniphase (JDSU) from the Paradigm 2000 Portfolio in late 1999. While its ranking remains in the top three, its stock price increases in value 94% in nine weeks. (Prices are rounded to whole numbers to conserve space.)

Date	Oct	Nov				Dec
1999	29	5	12	19	26	3	10	17	23	31
Rank	1	1	1	2	2	1	1	2	3	3
JDSU Price	83	99	100	107	133	126	122	120	149	161

How high a ranking is "highest?" The top five or six. This can differ from one portfolio to another. Experiment.

Here's another example, from the Classic Portfolio, of stocks rising significantly in ranking. Look at IBM in this case. Stocks crossing the median rank (18.5) tend to be good buys for the weeks or months ahead. IBM crossed median rank on April 30,1999, offering a 30% gain in ten weeks.

Date	Apr			May				Jun				Jul
1999	16	23	30	7	14	21	28	4	11	18	25	2	9
Rank	25	21	12	6	3	2	1	2	3	3	3	1	1
IBM Price	85	100	105	109	120	115	116	116	114	121	123	132	137

Now, to the selling side. When to let go? Give the stock room to fluctuate in rank. You set the ranking level. It need not be as tight as the buying-rank requirement. Here is a good example of a stock, America On Line (AOL) from the Internet Set Portfolio, which headed for the cellar after crossing the median rank (18.5) to the downside on December 17th, with its price then dropping from 85 to 59 in six weeks.

Date	Dec					Jan
1999/2000	3	10	17	23	31	7	14	21	28
Rank	13	14	19	20	21	20	26	27	29
AOL Price	78	91	85	81	76	74	63	65	59

HOW MANY STOCKS TO USE

The optimum for best results is six to eight (see Brealey). If your funds are limited, use as few stocks as it takes to keep your buying commission for each stock less than 1% of the total cost of buying the stock (price per share times number of shares). Do not think in terms of shares. Think in terms of total dollars per position. You should usually enter positions with equal dollar amounts in each.

HOW TO USE THE TRADEABLE INDEXES (ETF's)

Invest or speculate in the strongest of the three widely traded indexes, QQQ, SPY, or DIA, irrespective of their rankings in the portfolio in which they appear. Here is an example of what they looked like in the Internet Set Portfolio in late 1999. When they are ranked in the combined portfolios,100 stocks, the range is from 1 (strongest) to 100 (weakest). Note the disparity of relative performances during this period, with highest ranking QQQ (NASDAQ-100 Index) having the best gain, up 25% vs 6% for each of the other two index tradeables during the period shown.

Date	Oct				Nov				Dec
1999	8	15	22	29	5	12	19	26	3	10
Rankings
DIA	25	24	24	26	25	26	29	32	32	31
QQQ	16	18	17	16	15	15	17	16	17	21
SPY	24	23	23	24	23	22	26	30	31	30
Prices
DIA	107	100	105	108	108	108	110	109	113	112
QQQ	128	120	124	132	136	144	152	155	158	159
SPY	134	125	130	137	138	140	142	141	144	142

MARKET TIMING--WHAT ABOUT A BEAR MARKET?

It will start to show up in the relationship of the three portfolios with the more speculative tradeables falling down in rankings first and the more conservative rising. The more traditional tradeable indexes tend to move upward in rankings, especially DIA (Dow-Jones Industrials) because of the presence of "defensive" issues among its components. Further, selections from the Classic Portfolio will start to show up in the This Week's Best list (see below) with greater frequency and then dominate it. These indications suggest the presence or imminence of a bear market.

Intermediate market declines lasting several weeks to a few months are discernible from the Money Flow series at the bottom of the weekly Rankings table of each portfolio. These express the energy direction of the aggregate portfolio and may suggest a more or less favorable time for taking or relinquishing individual stock positions. A detailed explanation of Money Flows can be found in the Glossary-Index-Bibliography.

Picking the 'best' stocks is relatively easy. Making profits in them is another matter. In a bear market, losses will occur for most stocks, including the 'best.' Therefore a way must be found to determine 'up' and 'down' in market direction. Several measures point the way: Money Flows, Monetary Conditions, (and Dunes and Ponds in the site's "Separate Section on Market Timing" in the Contents column, Home). Take a look at these pages to see the probability of the presence of a bull or bear market.

USING 'THIS WEEK'S BEST'

This is a source pool for the strongest and most recently dynamic stocks. These tables show the top ten strongest issues both shorter term and longer term. Issues which appear in both tables are prime candidates for potential profits, especially if both sets of the stock's rankings are rising. These ranking numbers may differ from those in the Portfolios tables. That is because each portfolio table ranks itself while This Weeks's Best ranks all three portfolios taken together as a single grouping of 100 stocks.

It will usually be best to pay attention to the direction of a portfolio's Money Flow before buying any of its stocks. Strong, positive Money Flows provide the best environment for successful investing. And Trend Directions profoundly affect profitability.

DECISIONS AND PRACTICE

The site does not tell you what to buy or to sell, nor when to do so. It does provide you with well developed tools enabling you to may make your own selections for profits. Decisions are necessary. Your own are best suited to you. When you learn how to make them successfully, you will develop a growing degree of investing or speculating self-confidence and self-assurance attainable no other way. With practice, you will become better and better applying these stock-selection and timing methods to your own investment and speculating processes and to the expanding cumulation of profits.

SUMMARY--PUTTING IT ALL TOGETHER

• pick the best ranked stocks or rankings rising weekly
• buy at least 3 of them . . .
• better, buy 6 to 8 of them
• sell when a ranking fails *
• or just buy the best-ranked index stock and
• replace it when it falls to 2nd place and its portfolio Money Flow
      weakens
• stay out of stocks if portfolio Money Flow weakens or--more
      important--turns negative; avoid down trends--profits are few
• if Monetary Conditions are negative, the probability of investment
      profits is greatly diminished