Washington investors tend to be blue-chip stock buyers, conservative folks who favor big names like Fannie Mae, Marriott Corp. and Lockheed Martin Corp.

But almost every day an oddball little company called Xybernaut Corp. has more of its shares traded than any of those no-introduction-needed names.

Often, in fact, daily trading volume in the Fairfax maker of "wearable computers" exceeds the combined turnover in Fannie Mae, Marriott and Lockheed Martin.

Xybernaut trading volume averaged more than 10 million shares a day last week and topped 21 million shares on Nov. 7.

All that churning never adds up to much money because Xybernaut stock has been trading at less than $1 a share for months and lately has been bouncing between a quarter and six bits.

Though "penny stock" remains Wall Street's worst pejorative, low-priced stocks are alluring to many people. The attraction of cheap stocks is not only the price and the volatility that yields big gains on a percentage basis, but also the story. Without a story, nobody will pay any attention, let alone any money for a stock, no matter how cheap.

Here are the latest chapters in the stories of four low-priced stocks, Spherix Inc., XM Satellite Radio Holdings Inc., TeleCommunications Systems Inc. and Xybernaut, listed with their trading symbols.

Spherix (SPEX)

Spherix, or Biospherics as it used to be called, has been telling the same story for years and that is the problem.

It's a sweet story, about a new kind of sugar substitute called D-tagatose that is made from milk and is many times sweeter than aspartame, saccharin or the other stuff pumped into low-calorie products by the ton.

Though not in the less-than-$5-a-share range that with inflation defines "penny" stocks, Spherix stock is almost as volatile. Over the past couple of years it has gyrated from less than $4 a share to more than $11 a share.

Last week the stock popped above $8 for the first time in six months after a report that Kellogg Co. had obtained a patent to use Spherix's sweetener in breakfast cereals.

The serial swings in the stock reflect the irregular rhythm of the releases that flow from the Beltsville headquarters of the firm, which for years has financed its research and turned a small profit by also running reservations centers and phone banks. The company generated about $12 million in revenue in the first nine months of this year.

Success has been so close for so long that investors sniff at Spherix's handouts, especially ones like the Nov. 1 announcement that "a major beverage company" had "applied for" a patent on using tagatose in drinks. Many apply; few are granted, skeptics note, and with no name, it's not real news.

But there are solid developments: The federal government has ruled that tagatose is "generally recognized as safe" and thus can be used in foods. A giant Scandinavian dairy company is building a plant to make the stuff in commercial quantities next year.

The recent rise in the stock price triggered a previously announced plan under which Spherix's founders Gilbert and Karen Levin will dispose of part of their controlling interest in the company. On Thursday, Spherix said the Levins, who hold 24 percent of Spherix stock, plan to liquidate a quarter of it by 2004.

The tireless Levins are well past the age when most people retire. Some investors hold out hope that if tagatose does take off, they will sell the company for considerably more than the current stock price and use their millions to pursue the dream Gilbert Levin has followed since he got his PhD: proving there is life on Mars.

XM Satellite Radio Holdings (XMSR)

The XM Satellite Radio Holdings Inc. story really is a space adventure. The Washington company has two powerful transmitters in orbit, positioned so they broadcast 100 channels of music, news and entertainment to the entire United States.

Listening to XM requires special radios, which are just starting to be installed as options in many new cars, and a monthly fee of $10.

The sound is CD quality, the range of programming as broad as that of cable. The technology and the tunes get top reviews. XM is far ahead of Sirius Satellite, another company with an orbiting pay-to-listen network.

The trouble is that only 64,000 new customers signed up last quarter. Investors fear that XM could run out of money before it gets enough customers to cover operating costs, let alone get back the $1 billion already invested.

Last week XM announced it is laying off 80 of its staff, reprogramming some channels to cut costs and delaying payments on debts to General Motors Corp., its biggest investor and creditor.

That news and the report of the slow growth knocked almost 35 percent off XM stock in two days, driving it to a new low of $1.99 a share.

It's hard to find anyone who doesn't believe that someday pay-to-listen satellite radio will be as ubiquitous as cable or satellite TV. The question is: Who is going to own XM when it becomes a profitable business?

Will it be the investors who see the $2 stock as the best bargain in Washington? Or will it be GM or whoever else puts up the cash to bring XM out of the bankruptcy that many fear is only months away.

Step right up. Place your bets. The sky's the limit.

TeleCommunications Systems (TSYS)

New telecommunications technology is also the story at TeleCommunications Systems of Annapolis.

That company's future rides on two technologies that, like satellite radio, are going to be big someday -- text messaging and emergency location systems for mobile telephones.

The government has decreed that by 2005 all cellular phones have to be equipped with location tracking, so when someone calls 911, emergency crews will know where they are. TeleCommunications Systems is one of the two leaders in 911 location technology.

Text messaging is already being rolled out by all the cell phone providers as part of their wireless internet services. TSYS is a player, with contracts to provide software and services to Verizon Wireless, Cingular and several foreign phone companies. It recently signed a deal with America Online to provide "AOL alerts" to wireless phones.

As Thomas M. Brandt Jr., senior vice president and chief financial officer, explains, the company wants to be the gateway between the wireless networks and the Internet.

No start-up, TSYS had been around for a couple of decades. Founded by chairman and president Maurice Tose as a minority-owned government computer contractor, it survived and evolved into a telecom specialist.

There is still a government division doing "highly reliable and secure communications" work plus the private-sector cell phone operations.

Revenue grew 29 percent last quarter, and is now running around $90 million a year.

Operating losses are shrinking rapidly -- down to $2.5 million last quarter from $54 million a year earlier. For the first time this quarter, TSYS reported it is "EBITDA positive" which means it would have made money except for the expenses of interest, taxes, depreciation and amortization of goodwill and research costs.

The company went public during the tech boom two years ago. Its initial public offering popped from $17 a share to around $32 before the Nasdaq bubble burst.

After bottoming out at $1 a few weeks ago, the shares closed Friday at $1.72.

With candor that contrasts with the obfuscation and outright fraud of some corporate CFOs, Brandt describes his company's stock as "a lost ball in the tall grass."

Even though the company is a solid player in two emerging technologies and on the verge of profitability, no analysts follow the stock anymore and trading is minimal. Just 16,300 shares traded Friday.

Xybernaut (XYBR)

Trading volume is a problem for Xybernaut as well -- too much trading.

Volume and volatility go hand in hand. Xybernaut stock moves like a hyperactive video game, jumping 77 percent on Nov. 7 when volume hit 21.8 million shares.

On Friday morning, almost 2 million shares changed hands in the first hour of trading and the stock fell 7.5 percent -- from 67 to 62 cents.

During that same hour 109 messages were posted on the Xybernaut chat room at Yahoo.com. The Xyberwankers blabber day and night on Yahoo, blowing smoke into wispy illusions of trading trends, technological breakthroughs and too-good-to-be-true tales. Gamers and geeks calling themselves names like Pacman308 and Xybermandu dispense drivel that ranges from devious to deluded to just plain dumb.

The company's own statements are no more helpful to serious investors. "Throughout 2002, Xybernaut has successfully introduced new product lines, gained traction in critical industry segments, extended the Team Xybernaut partner community [and] strengthened our intellectual property position," the third quarter earnings report trumpeted last week.

And lost $7.9 million while its sales grew a puny 10 percent. The company has been so able to "successfully . . . gain traction" that it is in the midst of trying to trim operating expenses by 50 percent.

Realities such as the quarterly earnings report rarely correlate with big moves in Xybernaut stock. In the two days since the earnings report, the shares have fallen about 15 percent. The previous week they doubled in two days when the only visible event was the announcement of a contract to sell a few wearable computers to the Waldorf Astoria hotel. Since Xybernaut seems to issue a press release every time it sells anything, that didn't look like a market mover.

The stock did jump 30 percent last Tuesday when Xybernaut announced its latest patent for a Buck Rogers boy's toy:"a smart weapon system with integrated computing capabilities." Translation: sticking a little computer in the stock of a gun.

The wearable computers that Xybernaut pioneered are, in fact, catching on. Lots of car rental agents carry them. They can scan a contract, calculate costs and churn out a receipt from a holster-mounted printer. They're selling about $10 million a year worth to hotels, restaurants, car repair shops, the military and other markets.

But the most important Xybernaut invention, for which the company carries little responsibility, is a high-tech stock-trading game. It generates revenue for Nasdaq firms that make markets in its stock and makes some money for the Xybertraders smart enough to buy on the lows and sell on the highs.

That invention, unfortunately, has scared away serious investors who want nothing to do with a stock that's fallen into the hands of Xybernuts.

Jerry Knight writes about local stocks every Monday in Washington Business. His e-mail address is knightj@washpost.com.