Football is a lot like investing, and I'm talking about more than the thrill of victory and the agony of defeat.

Let's start with the importance of a diversified portfolio. Championship teams do not depend on one high-priced player. Instead they rely on the contributions of an entire roster, regardless of how large or small a part each plays.

When my favorite team's quarterback crumpled to the turf in a recent game, I couldn't help but ponder the impact of a potentially significant injury on the team's playoff chances. Just as with injuries in sports, there will be setbacks in investing, too, whether it is a bear market, interest rate volatility or just the inevitable incorrect investment decisions. But just as a well-rounded team, with a balanced attack, mitigates the risk of losing the wrong player to injury, a properly diversified portfolio helps weather the storm without compromising long-term investment objectives.

An age- and risk-appropriate portfolio will keep you on track to reach investment goals in the face of short-term setbacks. Most important is asset allocation, which determines 91 percent of an investor's total return. This is a rather fancy term to describe the process of divvying up your money between different investment classes, such as stocks, bonds, real estate, commodities and cash investments. An initially aggressive allocation should give way to a more-conservative approach as retirement, college tuition or

Think of how important your retirement savings are. You can't afford to make many big mistakes -- especially as the years go by and you accumulate substantial sums of money in your tax-deferred retirement plans.

One common mistake among risk-averse investors is to seek safety at the expense of growth. Putting all your money in a money market fund may keep it safe from volatility, but it won't help you stay ahead of inflation. You'll need to achieve growth in your plan. On the other hand, taking too much risk by choosing volatile investments is just as unwise, especially for people who are already retired or who plan to retire soon.

Smart retirement plan investing requires you to look at your individual situation so that you can properly balance safety with growth potential. And while the costliest mistakes are usually related to plan investments, you can make other mistakes that can create a royal mess.

Avoid these 8 mistakes:
1. Managing investments in isolation
2. Putting the wrong investments in taxable vs. tax-deferred accounts
3. Not taking advantage of employer matching contributions
4. Ignoring high fees
5. Not filing IRS Form 8606 with nondeductible IRAs
6. Believing you can't touch the principal in retirement
7. Assuming that using net unrealized appreciation is always the best option
8. Failing to update beneficiaries on your forms

"When they are cryin'" goes the old trading saw, "you should be buyin'."

Easier said than done, reply the legions of stock traders looking at a Dow Jones that is off this morning by more than 190 points, and a Nasdaq nose-diving by more than 75. This, to be blunt, is what makes trading difficult. Not the set-ups, not the systems, not the technique -- heck, we'll give you the set-ups, the systems, the techniques in our TradingMarkets Path to Professional Trading course.

No, what makes trading difficult is a lot like what makes life, sometimes, difficult: finding the discipline to do what you know you SHOULD do when the time comes to do it.

Sometimes I wonder if people who aren't familiar with the TradingMarkets approach to trading read articles like my recent "Four Bullish Bets for Traders" and expect to see four stocks soaring to new highs. That's usually what people think about when they think about "bullish bets."

The only problem is that stocks that look like that are likely not bullish bets for TODAY. They were somebody else's bullish bets, days ago, bets made when the stocks probably did not look anywhere near as "bullish" as they do when they are moving aggressively higher.

I've said it before: traders are never more bullish when their stocks are moving higher. That is understandable, but it can be counter-productive when traders are looking to establish positions in stocks

When companies announce a stock split, it can act sometimes as a tremendous catalyst that causes the underlying stock to gain momentum. For that reason alone it is certainly useful to understand the stock split process. To do this, it is important to know the requirements before a stock may split as well as the general profile of a company that may decide to announce a split of their stock.

First we need to be clear about what a stock split really entails. A stock split is a division of corporate stock by the issuance to existing shareholders of a specified number of new shares with a corresponding lower of the market value of each outstanding share. This of course is opposed to an actual stock dividend, which is usually a payment by a corporation of its own stock without a change in the market value of the underlying asset.

Typically, before a corporation, along with their board of directors, decides to split, the stock needs to be in a strong uptrend and also have a comfortable anticipation that the stock will continue the trend. Naturally, the company must have enough unissued authorized shares to split the stock, and then the board of directors must meet and declare a stock split.

If authorized shares need to be added, then the corporation must seek approval from shareholders, which requires a shareholder meeting for a vote to support additional shares being issued. At that point

Both my husband and I are in our early 50s and participate in our company's 401(k). My account is slightly smaller than my husband's. We have some additional funds and are wondering whether to open a Roth IRA or make a catch-up payment to my 401(k) account. What would be best for our future retirement?



As you may have guessed, the answer depends on a few more variables.

First question: Does your 401(k) plan match some, or all, of your contributions? If so, you should make a high enough 401(k) contribution to capture all matching funds. To get you to sock away a chunk of your pay in a 401(k) or other defined-contribution plan, your employer typically will offer to match your savings -- often by 50% for contributions of as much as 6% of your pay. So, if you put $60 of a $1,000 paycheck into your account, your company would kick in $30. A lot of workers misinterpret the math, mistakenly thinking they can put in 3%, or $30, and the company will match it by 100%.

You can also miss the match by stashing away large portions of your salary early in the year, because many employers only make the match paycheck to paycheck. So, if you put the entire $1,000 paycheck in

Philosophy 101 students are often asked to consider whether a tree falling in the forest makes a sound if no one is around to hear it. Morningstar analysts have often pondered a similar question in relation to fund investing. If a manager puts up great returns that real human shareholders weren't around to earn--either because the fund was ultrasmall at the time or because the fund was so volatile that investors bought and sold at poor times--is he or she really a great manager?

Maybe. After all, closing a fund to preserve future returns for shareholders is one of the most shareholder-friendly actions that a fund could take.

But those managers whose efforts have enriched many shareholders over a long period of time also deserve praise. Morningstar's three Fund Managers of the Year for 2007 fit that description. All have delivered strong absolute and relative returns for huge numbers of investors over many years. Their terrific Morningstar Investor Returns, which demonstrate that their shareholders have actually pocketed the lion's share of their published total returns, attest to their ability to steer steady ships that have kept shareholders aboard in all types of weather.

When making our Fund Manager of the Year selections, our deliberation process doesn't stop with a consideration of the number of shareholders that a fund has enriched and a fund's investment results in

DETROIT (AP) -- Toyota Motor Corp. overtook Ford Motor Co. to become the No. 2 automaker by U.S. sales in 2007, using new products and relentless strategy to break Ford's 75-year lock on the position.

Toyota sold 2.62 million cars and trucks in 2007, which amounted to 48,226 more than Ford, according to sales figures released Thursday. Toyota's sales were up 3 percent for the year, buoyed by new products like the Toyota Tundra pickup, which saw sales jump 57 percent. Ford's sales fell 12 percent to 2.572 million vehicles.

General Motors Corp. remained the U.S. sales leader, selling 3.82 million vehicles in 2007. But that was down 6 percent from the previous year as customers turned away from some large sedans and sport utility vehicles and GM cut low-profit sales to employees and rental car agencies. GM's car sales fell 8 percent for the year while truck sales were down 4 percent.

Overall, the year was expected to be the worst for the auto industry since 1998 as consumers fretted over high gas prices, falling home prices and the economy.

December also was a tough month for automakers despite a slew of holiday discounts. Toyota's sales slipped 2 percent for the month, while GM's sales were down 4 percent and Ford's fell 9 percent.

Nissan Motor Co.'s December sales were down 2.4 percent, while Honda Motor Co.'s December sales were

Wall Street's top forecasters have some good news and bad news for 2008. Many think stocks will head higher but that unemployment will rise and the overall economy will slow.

In other words, 2008 is going to look an awful lot like 2007. Despite falling housing prices and the subprime mortgage meltdown igniting fears about a broader economic slowdown, stocks pulled off a winning year in 2007.

For 2008, experts said investors need to be prepared for more woes in the slumping housing market and a slight rise in unemployment.

"2008 will be a sluggish year," Abby Joseph Cohen, Goldman Sachs' chief U.S. investment strategist, told CNNMoney.com. She said many investors are concerned about what could be weak earnings growth in 2008.

"Portfolio managers sense that 2008 will be a very difficult year for corporate profits," she said.

But Cohen believes that stocks could finish 2008 in the plus column as investors anticipate better news in the latter part of the year.

"We believe that the worst time is right now. The worst numbers will be at the end of 2007 and in the first

CLEVELAND (AP) -- Regional bank National City Corp. said Wednesday it is slashing its dividend 49 percent and shutting down its wholesale mortgage division, eliminating 900 jobs, due to weakened housing and credit markets.

The dividend was reduced to 21 cents per share from 41 cents per share, payable Feb. 1 to shareholders of record as of Jan. 14.

The news sent National City shares tumbling 5.3 percent, or 87 cents, to $15.59 in trading Wednesday. The shares had been as high as $38.94 in the past year.

Investors tend to choose bank stocks for stability and as a way to generate income from dividends.

National City also plans to raise more capital during the first quarter and has hired Goldman Sachs and Co. as its adviser.

The job cuts announced Wednesday bring to 3,400 the number of jobs eliminated in recent months as National City restricted mortgage originations to focus on prime rate borrowers with solid credit histories. Despite leaving the wholesale lending business in which brokers originate loans for National City, National City will continue to make loans through its retail banking offices.

National City has been hit hard in recent months because of rising delinquencies and defaults among

NEW YORK (AP) -- Shares of major homebuilders declined Wednesday after a government report indicated residential construction spending dropped for a record 21st month in November, as the housing market continued to suffer through its worst slump in two decades.

The Commerce Department reported that private residential construction fell in November by 2.5 percent to an annual rate of $484.9 billion, down 17.5 percent from a year ago.

However, spending gains on government projects and nonresidential construction offset the decline in residential projects. Total spending on construction projects inched up 0.1 percent in November, exceeding economists' expectations.

Builders have recorded major losses in the past year as they contended with declining home prices and sales, plus ballooning supplies of unsold homes. The disrupted credit markets have diminished the pool of qualified home buyers, and a spike in foreclosures has dumped more supply onto the market.

Most economists believe the housing slump will last through 2008, forcing builders to further slash prices on already built homes and sharply curb construction plans.

On Monday, M/I Homes Inc. said it will take charges of about $80 million in the fourth quarter on the sale

NEW YORK (AP) -- Wall Street skidded lower Wednesday after a weaker-than-expected reading on the manufacturing sector and a spike in oil prices to $100 a barrel triggered concerns of a further slowdown in the overall economy.

The major indexes each lost more than 1 percent, with the Dow Jones industrials giving up more than 200 points. It was the blue chip index's biggest point decline for the first day of trading in a new year.

The Institute for Supply Management's report that its manufacturing index fell to 47.7 percent for December from 50.8 percent in November raised concerns that the economy could be slowing at a quicker pace than some investors had estimated. The reading below 50 signals economic contraction, whereas readings over 50 indicate expansion.

Analysts polled by Thomson/IFR had anticipated that manufacturing would expand modestly in December.

Light, sweet crude rose $3.64 to $99.62 per barrel on the New York Mercantile Exchange after earlier hitting $100 for the first time. The rise follows violence in the oil-producing nation of Nigeria, concerns about weather-related production halts in Mexico and speculation that inventory figures will show drops in

NEW YORK (AP) -- Crude oil prices briefly soared to $100 a barrel Wednesday for the first time, reaching that milestone amid an unshakeable view that global demand for oil and petroleum products will outstrip supplies.

Surging economies in China and India fed by oil and gasoline have sent prices soaring over the past year, while tensions in oil producing nations like Nigeria and Iran have increasingly made investors nervous and invited speculators to drive prices even higher.

Violence in Nigeria helped give crude the final push to $100. Bands of armed men invaded Port Harcourt, the center of Nigeria's oil industry Tuesday, attacking two police stations and raiding the lobby of a major hotel. Word that several Mexican oil export ports were closed due to rough weather added to the gains, as did a report that OPEC may not be able to meet its share of global oil demand by 2024.

Light, sweet crude for February delivery rose $4.02 to $100 a barrel on the New York Mercantile Exchange, according to Brenda Guzman, a Nymex spokeswoman, before slipping back to settle at a record close of $99.62, up $3.64.

Oil prices are within the range of inflation-adjusted highs set in early 1980. Depending on how the