The Holiday Portfolio: Labor, Indeed

Still, Microsoft has loads of cash, continues to see growing adoption of the new Vista operating system and will benefit from what appears to be a 2008 computer upgrade cycle. Look for new management team members to refocus the company on creating shareholder value in the coming months. If right, it will pay to be patient; if not (and I haven't been right on this name for some time), more of the same underperformance is likely.

Archstone: The Acquisition Rule Works

The final member of the 2007 portfolio is Archstone-Smith(ASN Quote), a REIT that is currently in the final stages of closing a sale to a group of investors led by real estate concern Tishman Speyer and Lehman Brothers.

After announcement of the deal in late May, I suggested in July that taking profits on an M&A announcement is a good discipline. In this case, that was exactly the correct call. Since the announcement, the stock peaked at about $62 per share and proceeded to drop to $54 per share.

While I continue to believe the deal will close, probably in mid-October, there remains some risk, especially given the recent turmoil in financial markets. As such, there is no investment call here. We will replace Archstone-Smith in the portfolio once the acquisition is complete.

New Markets, Same Rules

When markets become difficult, it's sometimes easy to forget -- or even abandon -- the discipline that is developed in more sane times. It's important to remember that investing is a long-term process and with challenges come opportunities.

The end of summer and a market that may make little sense provide two good reasons to review your investment plan and make sure you are still on-track. Over the past decade I have written extensively about strategy and the hallmarks that guide my investment decisions.

Take a few minutes and labor over your investment discipline this holiday. Not only will it help you rest better at night, it is likely to make you a better investor.