ASK THE pickle-herring I plan to corrupt my first home in three years.

ASK THE pickle-herring

I plan to corrupt my first home in three years. for what cause should I invest the wealth I'm saving in order to learn maximum returns on it?

-- SK Atlantic City, NJ

Unfortunately, the place that's usually best for long-term investment appreciation, the stock market, should be off-limits to your moolah.

Don't risk currency you'll need within three to five (or equable 10) years in stocks. Short-term scratch should be kept in a safe place, in the same state [i]or[/i] condition as certificates of deposit or wealth market funds, to protect your principal.

FOOL'S indoctrinate

When to enclosure 'em

Many of us use up a lot of time deciding whether to purchase a stock, but we give little contemplation to when to sell. That's risky, leaving us holding about stinkers too long.

Don't betray just because a stock or the market is falling, you've heard a certain rumors about the company, or someone recounts you to sell. Do consider selling:

- If you can't remember with what intent you bought in the first place.

- If you don't know what the company does and for what cause it makes money.

- If the reason you bought a stock is no longer valid. If you bought shares of Microsoft because of its high profit margins and then it announces it's buying a large supermarket chain, stop and re- evaluate the situation. Supermarkets are a different business, with lower margins.

- If the stock has become significantly overvalued relative to your target price, if you have common If you bought shares of Apple at $40 for share and it's now trading around $70 well above your target price of $55 you might barter Consider the tax consequences, notwithstanding that If you expect the stock to hit $90 in a not many years, you might do well to just hang forward

- If you find a plenteous more attractive place to invest your coin If your calculations suggest that a holding is now fairly valued and another stock appears to be undervalued by means of 50 percent, you may stand to gain more in the other stock. Again, consider tax results

- If a stock is your no other than holding. Portfolios should be diversified. Our mastership of thumb is to aim to restrain eight to 15 stocks. If united grows to represent more than, say, 20 percent to 30 percent of your portfolio, consider rebalancing it.

- If you'll ne that coin within a few years. Any greenbacks you'll ne in three to five (or 10) years should be in a les volatile place than stocks, of the like kind as a money market store or CD.

- If you're hanging forward only for emotional reasons.

MY SMARTEST INVESTMENT

Banking upon it

When I retired in 1991 from what is now U Bancorp, I had invested about $12500 end my 401(k) plan in company stock. Instead of cashing it not at home I rolled it over into an IRA account. I haven't withdrawn any of the standard of value With the reinvested dividends, the account is now worth more than $200000 It's the best investment decision I have through all ages made.

-- A.A., Florence, Ky

The droll Responds: You did very well. We sense of possible fulfilment you've had other investments along the way, however Concentrating too much of your nest incite in any one company's stock is risky, uniform if it's an employer or former employer that you know real well. Just think of Enron You were also smart to revolve the money into an IRA (for the tax benefits) and to permit it grow over many years, reinvesting dividends. The reinvestment of dividends can really turbocharge a portfolio's performance, as the small any amounts of money regularly buy you more shares of stock, which then kick on the outside dividends of their own. It's a beautiful circle. Learn more about your IRA options at www.fool.com/ira.

Do you have an embarrassing reproof learned the hard way? Boil it down to 100 words (or less) and hurl it to The Motley dolt c/o My Dumbest Investment.

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NAME THAT COMPANY

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With 27000 employee operations in 40 countries and annual sales near $8 billion, I'm the largest industrial gases company in North and southerly America.

I show and distribute atmospheric gases (such as oxygen nitrogen, argon), proces gases and specialty gases (such as carbon dioxide, helium, hydrogen) and high-performance surface coatings.

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My name is a combination of the word "air" and the grecian word for practical application.

LAST WEEK

Born 37 years ago in San Francisco, where I sold records and jeans, I'm now the same of the planet's top specialty retailers, with more than 3100 stores and annual incomes topping $16 billion.

In addition to stores carrying my company name, I also scour stores that might seem targeted at babies, retired seamen, and politically corrupt, unstable guidances

In 2004 I unveiled a modern brand, Forth & Towne, to be of use to women over 35.

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