alt="StockScouter investment returns chart" title="StockScouter investment returns chart" >It's been a while since we had a look at our StockScouter investments. Let's check in on how our investments are doing.

As you may recall, we're tracking Jon Markman's 2nd half of 2007 StockScouter portfolio. His system selects 10 stocks from the universe of stocks based on their timeliness and appreciation potential. I've been blogging about the StockScouter system since the most recent selection was made, tracking it's progress through the market's ups and downs.

According to Jon Markman. The StockScouter stock selection system has never had a six month period where it underperformed the S&P500. With less than three months remaining, the StockScouter portfolio has some catching up to do. Four of the ten original picks are down 10% or more. A fifth, Pride International, is down 8.8%. The worst performing stock in the group has been Hiland Holdings GP. Hiland is down over 20% since our hypothetical investment was made in July.

Read much about personal finance and you'll find there is one question few agree on: How much to set aside as an emergency fund.

The idea for emergency funds is sound. The odds are good we'll all need access to money in a hurry at some point. Nearly everyone encounters a rough spot somewhere along the road in life. When we do we might need fast access to money to see our way through.

The problem with emergency funds is in funding them. You work hard, you save. You invest money in the stock market for the long term because that's where the real investment returns live. You don't want to have to sell stock to meet needs in time of emergency because of the taxes we'll have to pay on our gains.

I have a short and sweet rule for investing for you today. If you ever hear the words "hot" and "stock" and "tip" together in a whispered sentence. Walk away. You get bonus points if the come-on contains the word "inside".

These don't come my way as frequently as they used to. Probably because those who always seem to have these prime bits of information know I'm never in the market for hot stock tips. When they do, I always just smile, say thank you and walk away.

Just the other day I wrote about the kinds of things I choose not to invest in. Here we are only a few days later and I have a nice follow up story to it.

Remember a few months ago I wrote and article about a fellow who builds bicycles as works of art? He wrote me a note yesterday to say how well one of his investments have paid off lately.

I liked your piece on things you wouldn't invest in. I think you should say shouldn't invest in. (emphasis added) My bike hobby paid off big time a couple of weeks ago. I sold an old but nicely restored track bike for almost 15 times what I put into it. ...

I got an email from a reader a few days ago. The message was in response to my article, What to Invest in Now. It had to do with asset allocation and risk management, which my article touched on briefly. The reader pointed out that his company had helped him solve the allocation vs. risk problem in the most optimal way possible. His company had just contracted with a major mutual fund company to provide access to a family of professionally managed retirement date targeted mutual funds.

Did you get that? It's a mouthful. Here's what it means. He can now put some or all of his 401-k savings into a certain type of managed account structure within his 401-k. He then tells the manager what he wants his expected retirement date to be. Within the managed account structure, his funds are then apportioned among a number of mutual funds according to some optimal asset allocation formula known only to his 401-k management company.

Yesterday was one of those great days in the market, wasn't it? A strong start and an even stronger finish. Big up days feel good. Today I feel like taking the day off for a round of golf. And why not? I deserve it for sticking with my plan and successfully carrying out my long term buy and hold investor's strategy.

Now, the fact is, any day is an OK day to go play golf. But days like yesterday are unlike most other days for the long term buy and hold investor. I believe that only the long term buy and hold portfolio strategy positions an investor to take advantage of days like yesterday.

We had quite a turnaround in the S&P500 last month over what we saw in August

Overall I'd say you're just plain unlucky if you did not manage to make money in stocks last month. The average stock in the S&P500 returned 2.3% in September. Not only that, but that return came with little fanfare. Volatility was down from August, and significantly lower than average return. Remember the old song about the monkey throwing darts at the newspaper? In August the monkey made lots of money.

Do you remember the retirement investment seminar I told you I would attend last week? I went to it thinking I might learn something new. (See You are Never Too Old) As it turns out I did learn something new. I didn't learn anything new about investing, but I did learn something new about selling financial planning services.

I realized how important it is to see investing as the boring activity it is. In fact, investing really isn't much of an activity at all. Investing is mostly inactivity.

The financial planner conducting the seminar did a great job keeping the audience engaged as he went along with his presentation. There were plenty of questions from the attendees, and many of them showed the audience was listening and learning.

One question in particular had to do with keeping a long term perspective when it came to saving for retirement. Maybe it wasn't so much a question as a protest. She didn't like the idea of sitting and waiting for her nest egg to grow. She felt like she should be doing something, taking some kind of action, doing some work to make her investments grow.

Today I thought it might be instructive to look at a few things some people call investments, but which I would never invest in. I happen to be of the opinion that too many things are bought and sold on the premise that "it's a good investment" when in reality they are not.

Here are six classes of "investments" which I would never invest in - at least not with my own money. Actually, I wouldn't even invest someone else's money in any of these things.

Have you seen the news lately? Doom and gloom. The housing market is in a meltdown. New record lows in sales, record highs in inventory... Everyone's concerned. What does it mean? Where will it lead? When will it end?

And maybe most importantly, where should I put my money?

My answer to the question, "What should I invest in now?" never changes. My answer always remains "Invest primarily in stocks, secondarily in bonds". You need both. You always need both if you want the best return on your money with the least amount of risk.

Now the super aggressive reader here might be saying to himself that 100% stocks is the way to go. There is no question that to get 100% of the potential return on an investment in stocks you should invest 100% in stocks. Consider, however, that by mixing in a small percentage of bonds an investor can lay off 20% or more of his risk while retaining 90% or more of his return potential.