Splitmaster Newsletter 2005-10-02

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Author: Mike Celeste		Editor: Tony Ponzo		October Circulation: 13247

STAT SHEET WEEK ENDING Oct. 1, 2005

2005	Year-to-Date, thru Sept.30				Percent

Dow Year-to-Date Change				Down	2.0%
S+P Year-to-Date Change				Up	1.4%
Nas Year-to-Date Change				Down	1.1%

Splitmaster Year-to-Date
		Basic		Up	22.3%
		Big Dipper		Up	26.8%
		Option
			Calls	Up	250%
			Puts	Up	396%

2005 Quarterly
				Percent	Points
Dow 3rd Quarter Change				+ 2.9%	+ 294
S&P 3rd Quarter Change				+ 3.2 %	+ 38
Nas 3rd Quarter Change				+ 4.6 %	+ 95
SplitMaster 3rd Quarter
	Basic			+ 8.9 %
	Big Dipper			+ 12.7 %
	Option Calls			+ 57.0 %
	Option Puts			+117.0 %

2005 Monthly-Sept.				Percent	Points
Dow Sept. Change				+ 0.8 %	+ 87
S&P Sept. Change				+ 0.7 %	+9
Nas Sept. Change				0.0 %	0

SplitMaster Sept.
	Basic			+ 2.71 %
	Big Dipper			+ 0.92 %
	Option Calls			+10 %
	Option Puts			+51 %

2005 Weekly -End 10/01/05				Percent	Points
Dow Weekly Change				+1.4 %	+ 149
S&P Weekly Change				+1.2 %	+ 14
Nas Weekly Change				+1.7 %	+ 35

In this Issue---
** SplitMaster Basic System--Another winning quarter & month.
** SplitMaster Big Dipper System--Also wins quarter & month
** Options--Triple digit gains on puts, double digits on calls
** S+P 500 --Still not there
** The Quest--Goal:Turning $1,000 into $1,000,000 in 10 years.
** Chart Indicator--Approaching Neutral from Negative
** Split comments--Year-to-date still looking great
** Feedback Comments--Really?
** New Option Testing--Another winning week, but.......
** Tip of the Week--Insider Trading
** Economy Reports and Commentary--Mixed signals
** Today's Thought

SplitMaster Basic System---
***********************************

NBL Let's look above at the stats for the different periods, so far this year. Our goal is to beat the major indexes. Take any period above and you will see that we have continued to be ahead of them. And we don't just edge them out, either. While the Dow and Nas are losers --yes, losers--so far this year, SplitMaster continues to roll ahead. For the quarter and last month we about double/triple the major index results.

Big Dipper System---
************************

This system also continues to outdo the major indexes. While the BD squeezed out a relatively small gain for September, it did beat the September results for the majors. The 2 previous months were such winners that the BD had a fine gain of 12.7% for the 3rd quarter. There were some unusual negative factors in Sept. (hurricanes) that we don't usually see, thank goodness, so we continue to have high expectations for our Big Dipper System.

Options---
**************

My favorite stat---options--continued to bring in results that seem too good to be true. (See Feedback Comments). Take a close look at those option figures---Option Calls + 57.0 % and Option Puts + 117.0 % for the quarter. Double and triple digit gains--again, for the quarter.
Even the monthly figures for Sept. are double digit gains. The secret is getting some of each and every play. You should do this because if you choose and pick, ("cherry picking") sure as SplitMaster wins year after year, you don't get the one that has a huge gain and you get the one that is a loser. Those big gainers more than make up for the occasional loser.

S+P 500 Options---
******************

We still didn't pull the trigger, and there was a question when the Dow was up every day this past week---which is good in this system as we are writing/selling puts and want the market to go up. However, our other indicator that we use for this system is still negative, so we are still waiting to see if the market will fall back and we can write/sell the put at a better price.

The Quest
******************

No new investments in this system. We are over goal for 2005, but we still plan on investments later this year. Our goal for 2006 is to get to $4,000. Stick around and see if we make it.

Chart Indicator---
*********************

The indicator is still negative, but moving up towards neutral---if the Nas stays where it is, we might see a return to Positive soon.

Stock Split Comments---
********************************

We are very happy that the 2 worst months of the year, historically, are behind us. October is a month that many fear, but it really isn't as bad as some people think. True, there have been violent moves in a few Octobers past, but when placed with all the other October results, it is a month that I can live with. In regard to SplitMaster, the last 3 years of the Basic had 1 winner, 1 loser and 1 with no plays. Our net return for the 3 years was a positive.

Feedback Comments--
*************************

Comment---".....your results/profits,particularly the put option strategy appears fantastic,almost
unbelieveable. I am aware of the FEAR/GREED mantra."

Our Response--Those are really the actual figures. We realize they might seem questionable, but we post each and every option on our site beforehand, for our team members, and on Past Results as they close out, for anyone else to freely check. Options are traded on 5 different exchanges, so sometimes there are slight differences, but not enough to change our figures. Options trading provides exceptional opportunities for those experienced in this field. Altho about 80% of options expire worthless, we use that information to our advantage, in combination with our stock split strategies. We are also using options in our special strategy, The Quest--see the site and brief comment below.

New Option Testing--
*************************

We had another winning week in our Beta testing of this new system, but we are still making slight modifications in determining our final criteria. We think the delay will be worth the wait. For this past week we had a gain of 14.98%, or 779%, if Annualized. These are 1 day plays, so you are rolling over your money each day. We, ourselves, can't wait until we decide we have it calculated as best we can, so we can get our own $ invested.

Tip of the Week---
*************************

Insider trading is an area that can be checked from time to time, especially when there is a volatile stock movement, with no news to account for it. You can get this info from different sources, but Yahoo Finance provides an easy click that shows the latest reports. If there are buys by Insiders and they are at current stock value (not thru exercising options), that could be a good sign that the insider feels the company is moving in an upward direction. Sales by insiders are another story. There are many reasons an insider might be selling. They might need $ for taxes, for a house, another business investment, etc., etc. Then again, they might be selling because they think the company is not moving in the right direction. When this is the reason, you will usually see many of the executives selling. At any rate, it can be the reason for the sudden move in the price of the stock, and it is worth checking. You like to know what the insiders think of the company you are investing in, or thinking of investing in.

Economy---
*****************

The economy had mixed results this past week. Early in the week had more negative news. "WASHINGTON (AP) -- Sales of new homes plunged in August by the largest amount in nine months as the nation's housing industry continued to flash mixed signals about whether the boom is starting to fade.--In other economic news, the Conference Board in New York reported that consumer confidence plunged in September to a reading of 86.6, down from the August level of 105.5. It marked the lowest level for consumer confidence in nearly two years, since October 2003. Various consumer confidence measures have shown sharp drops recently, reflecting the surge in energy prices including gasoline that topped $3 per gallon right after Hurricane Katrina shut down Gulf Coast refineries.--One-year adjustable-rate mortgages rose to 4.68%, the highest level in more than 3 years.."

By the end of the week it seemed that investors were getting past the hurricanes damages and had a rosier outlook. "Consumber, business spending revised up. DGP date and a reporton jobless claims suggest the economy will recover quickly from Katrina and Rita." As I've said before, tragedy for some bring great benefits to others. Billions from the Federal government are being poured into recovery efforts in the affected areas which in turn will most likely stimulate the economy in those areas.

Today's Thought--
**********************

Never have children, only grandchildren. ~Gore Vidal

Mike

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