David Edwards, senior portfolio manager with Heron Capital Management, Inc., says this is the toughest time emotionally for investors since 1994. Stock market averages aren't advancing as money churns from one sector to the next, and the volatility of individual stocks is high. Yet, those investors who can use this correction to pick up good growth companies at a reasonable price will do well over the next 1, 3 and 5 years.

Edwards' investment strategy for his clients includes 25% weightings to technology, healthcare and financial services, with the remaining 25% invested in energy stocks, REIT's and slower growing, high dividend stocks. "The outlook for technology investments is the most pessimistic in a decade. We believe that this pessmism is as extreme to the downside as last winter's exuberance was to the upside." Given that financing options for start-ups and smaller companies are extremely limited right now, Edwards focuses his search on those companies with positive earnings, market leadership positions, and most importantly, high cash flow/share.

Edward identified 5 companies which meet these criteria. These companies are currently held in HCMI client portfolios, although positions can change at any time.