Basic Timing

Daily commentary, current portfolio structure and history follow.

Please direct questions and comments to:
Drach Market Research
2910 Kerry Forest Parkway D4-210
Tallahassee FL 32309
Tel.: (850) 576-2680
E-Mail: DrachMkt@aol.com

Portfolio model initiated 5/5/95, archived and marked to market daily.
Initial level 520.12. Current relative value 1,512.12. Gain +190.73%.

These results are reflective as to capital capture and market price of current holdings, itemized below. They do not include cash dividends, interest earned on cash balances, transaction costs, or anything else.

Current Stock vs. Cash Allocation

$1,525,574.65 (100%) stock. $11.55 (0%) cash equivalents.

Summary of Closed Positions

Total Positions  370                    Average Position
      Profit     336  (90.81%)           Percentage  +  8.58%
      Loss        34  ( 9.19%)           Days Held    202
      Even         0  ( 0.00%)           Annualized  + 15.50%


Relative performance since portfolio initiation (5/5/95)

This Model Portfolio      + 196%
Dow Industrial              + 190%
Nasdaq Composite       + 190%
S&P 500                     + 168% 

Model Portfolio Changes: None.

Major movements (+ or - one point or more among holdings): Danaher +1.23.

Exceptionally strong gains in commodity related issues (oil traded over $124/barrel for the first time) allowed the most popular averages to post a positive session: Dow Industrial +52.43, S&P 500 +5.11, Nasdaq Composite +12.75 while this portfolio model (not exposed to the commodity areas) lagged.

There are three basic components to commodity pricing: fundamental demand/supply, U.S. dollar value, and degree of speculation. There is no clear measure as to the amount of speculation. However, when price movements become disproportionate to fundamental demand and price gains are parabolic as now evidenced, the speculative influence is usually inordinately large. Commodity bubbles can meet a variety of pins including increases in margin requirements or simply fall on their own weight. Whatever the cause, declines from parabolic advances are usually sudden and severe because of the large amount of leverage employed. The margin requirement for crude oil is only around 7%.