Nov. 30--A year ago, Sadoff Investment Management LLC owned hardly any stocks.

Now managers at the Milwaukee money management firm say they've gotten back into the market.

"We're cautiously optimistic, although we're not 100% invested yet. There are still a few hurdles," said Michael Sadoff, a portfolio manager at the firm.

That cautious optimism is a far cry from October 2008, when Sadoff had nearly 80% of many clients' assets in cash and Treasury bonds, he said.

Sadoff started getting more interested in late March, when the New York Stock Exchange advance-decline line showed twice as many stocks were rising as were falling during a 10-day period. That pattern repeated itself over a 10-day period in July, Sadoff said.

The advance-decline line has done that only 12 times since 1949, and each time the market was higher a year later, he said. The possible hurdle that has him hesitating slightly is that, despite new market highs in November, the number of stocks achieving new highs and lows has been shrinking, he said.

Still, even though the economic environment remains anemic, other technical indicators and the psychology surrounding the stock market are encouraging, Sadoff said.

"We've seen lots of indicators this summer that probably only hit once every 10 years telling us these are the early stages of a bull market, not the late stages," he said.

Low inflation and low interest rates are also contributing to a good environment for stocks, particularly technology and financial shares, Sadoff said.

He says his firm relies on technical information to gauge market trends, then digs into fundamentals to evaluate individual companies.

Here are four stocks Sadoff owns in client accounts that have promising businesses and have recently broken out of long-term down trends, he said.

EMC Corp. (EMC, $16.75), Hopkinton, Mass., and Net-App Inc. (NTAP, $30.83), Sunnyvale, Calif., provide storage and data management.

They both have strong businesses that should benefit as companies that are operating with fewer employees try to increase productivity through moves like saving money on their data storage costs, Sadoff said.

"There's so much data out there and it's growing by leaps and bounds, so they'll need help from these storage companies," he said.

EMC has traded in a 52-week range of $9.61 to $18.44 while NetApp is trading close to its 52-week high of $31.50.

Invesco Ltd. (IVZ, $21.68), Atlanta, is an investment management firm and TD Ameritrade Holding Corp. (AMTD, $19.34), Omaha, Neb., provides online brokerage services.

Invesco has about $400 billion of assets under management through operations like its AIM mutual funds. Its shares are trading near the upper end of a 52-week range of $9.33 to $24.07.

TD Ameritrade has improved customer service and put more proactive people in its branches, moves that are helping the firm become more than just an online broker and steal market share from big brokerage firms, Sadoff said. It, too, is trading near the upper end of a 52-week range of $10.09 to $21.30.

The biggest risk Sadoff associates with all of these shares is the possibility of a market pullback or a double-dip recession that would cause tech spending to decline again, he said.

Stocks like those of NetApp and TD Ameritrade could rise 15% or more in the next 12 months, he said.

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