Last week the Feds lowered interest rates. While this usually raises the value of the bonds it does create re-investment risk for current bond holders. Reinvestment risk is the possibility that your cash flow (bond income) will not be re-invested at the same rate of return or interest rate as your current investment. (Nov. 15)

One method of diversifying your risk is to buy mutual funds. You can buy stock or bond mutual funds or a combination of both. Mutual funds allow you to buy many stocks or many bonds instead of just a few. There are over 10,000 mutual funds for you to choose from. (Oct. 25)

VIPSX is a TIPS (Treasury Inflation-Protected Securities) intermediate-term bond fund, and it is riding the wave of TIPS's immense popularity. VIPSX is up a whopping 13.6percent this year alone & ranks in the top 1 percent in its category.  Such big returns aren't sustainable so sell sometime soon. TIPS aren't recommended for a taxable account. (Nov. 21)

Avoid long-term bonds, even for long-term investing, because their share prices fluctuate wildly when interest rates rise and fall as they inevitably will. Between September 1998 and December 1999, Vanguard's Long-Term Bond Index fund shares plunged over 15%. Instead, pick no-load (no sales charge) intermediate-term or short-term bond funds with low expenses. (Nov. 21)

These picks were made within the boundaries, guidelines and restrictions that are specific to this hypothetical. Even with careful consideration given to the significant downside risk inherent in short-term investing, it is impractical to assume any rate of return. For three months, a certificate of deposit would be more appropriate. (Nov. 22)

Long-term strategy should be unique to your particular needs, requirements,risk tolerance and time horizon. Portfolio diversification is important to minimize risk. Over concentration into any one asset class may increase capital risk. Thanks to the readers that have called to discuss the picks and their individual investment situations. (Nov. 22)

We are encountering resistance near the September highs. I believe the markets should retrace some of it's gains, and then continue higher late in the year. Normally, I would be going to a neutral bias in anticipation of a pullback, but since the challenge ends next month I will go a little more aggressive. (Nov. 4)

The outlook for the market is better. We have had some impressive gains over the last few weeks. The market sprinted out of the gates, but we must remember the race is a marathon, so I would look for the market to take a breather around here. The timing and length of a pullback is debatable. I would also remind investors that not much has changed in the macro economy. (Nov. 4)

The next two quarters will be challenging, but CSCO should be able to take advantage of smaller competitors' demise and expand their internet router market share beyond its current 85 percent.COST has lowered its November quarter earnings estimate to 30-32 cents but gross margins are increasing as a result of more directly sourced merchandise. (Nov. 15)

Fed Chairman Alan Greenspan, in explaining the latest 1/2 percentage point rate cut, told congress that the U.S. economy had hit a "soft patch" but expects us to get through it. The economy is weak not dead. Consumer sentiment halted a five-month slide this month. Since consumer spending drives 2/3 of our economy, that's a good sign. I remain cautiously optimistic. (Nov. 15)

This relatively quick rise in market values in the last few weeks have obviously hurt the performance of my bond fund and market short fund selection. Despite this, we feel still feel these holdings will continue to do well as a defensive investment. (Nov. 2)

There is still more downside risk in the overall market. We're in a trading range in which active traders would probably do better than the buy and hold investor. Obviously, the limited monthly trading restrictions in this contest prevents active trading. If this is the bottom, then a retest of the recent rise will be needed. There will be ample opportunities for long investors to buy in at lower levels. (Nov. 2)