ANCHOR (OFF-CAMERA) ENGLISH SAYING:

So we had stocks basically on this huge run. Right. What are investors thinking here? Are they getting ahead of themselves? Are stocks getting ahead of themselves? Are they simply less attractive given what's happened in the last couple of weeks?

BARRY JAMES, JAMES INVESTMENT RESEARCH, (ENGLISH) SAYING:

Well, I would say it's probably all of the above for a- you know. As we look at the market, we try to look at risk levels. We don't really know one day or the next whether the market is going to be up or down. But what we've seen is the market has had about a 9%-10% run off of its lows and what we've seen was a lot of people were really worried about the fiscal cliff. And as that had passed, then we see a lot more enthusiasm toward the market. And when we start to see that enthusiasm, that tends to pull us back a little bit in terms of our enthusiasm.

ANCHOR (OFF-CAMERA) ENGLISH SAYING:

Now you on the equity side of your fund, have several different types of stocks. You've got consumers kind of stocks, cyclical, non-cyclical, finance, tech. Right. Of those groups- basic materials is another one- what are you most likely to add to in terms of your weighting this year?

BARRY JAMES, JAMES INVESTMENT RESEARCH, (ENGLISH) SAYING:

Well, right now, we see a couple of areas that we like. We like the automotive sector for one. Cars are really old on the road and automotive sales are going up. And if you look at the debt servicing, that has been falling. People have gotten their balance sheets in order and they're anxious to spend a little bit more money. So that's positive. We like home builders. We see that we're moving out of this phase of lower prices and lower sales. We're now on the uptrend in both of those. And one of things we like to look at is the traffic numbers that come from the National Association of Home Builders. It's a very good tell of future home sales and prices, and that's on the way up. So those are two positive areas. Finance companies look pretty good because you look at the spread between what they're borrowing money from the Fed and what their in turn lending it for, it's over 3%. And so, they're able to make money pretty well hand over fist.

ANCHOR (OFF-CAMERA) ENGLISH SAYING:

We should explain your philosophy because I'm going to argue, all of those sectors you mentioned have had a pretty good run. That's true. Home builders in particular last year, right? Right. So, the argument will be: Well, Barry what are you think? Why don't you actually take money off the table?

BARRY JAMES, JAMES INVESTMENT RESEARCH, (ENGLISH) SAYING:

Yes. Well, you make a good point. The biggest mistake that we find people make is that they sell the winners and hold on to the losers. And what we try to find are companies that are cheap and have good earnings, and their prices are actually in a nice long term rising pattern called relative strength. And in each of these categories you can find companies that reflect those three tenets of the way that we approach. And that really comes down to what do you own; if it's cheap and has good earnings, why wouldn't you want to own it? But more importantly, when do you own it? And it's in the rising pattern. People are starting to add the positions to their portfolios, and that can continue for a long period of time. So we're not afraid of buying a company at a new high as long as it's cheap and has good earnings.