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Next month, Americans (those that vote, in any event) will head to the polls to choose a new chief executive. The major candidates and their running mates are pledging to steward the nation through continued prosperity and fiscal health. To determine which candidate is best suited to run the nation's fiscal engine,

examined how the candidates handle their own financial houses and huddled with professional financial planners. The planners had some advice for the candidates on how to improve their portfolios. So this week, we're running the advisers' presidential portfolio makeovers of the major candidates, as well as the Republican and Democratic vice presidential contenders. We examined Democrat Al Gore's portfolio Monday, Republican candidate George W. Bush's Tuesday, Green Party hopeful Ralph Nader's Wednesday, Reform Party headliner Patrick J. Buchanan's Thursday and Democratic Vice Presidential Candidate Joe Lieberman's Friday. Today, we close out the portfolio makeovers with GOP Vice Presidential Candidate Dick Cheney.

In terms of his personal finances, Dick Cheney confronts two problems. The first is strictly one of image: American voters like their rich public officials (and would-be officials) to appear generous, and Cheney's record doesn't quite meet those expectations. (For that matter, neither did Vice President Gore's back in 1997, when he also came under fire for paltry charitable contributions.) Cheney, who made over $4 million last year, caught flak when it was revealed that his direct charitable contributions over the past decade amounted to less than 1% of his '99 income.

The situation is complicated by the fact that George "

Rally the Armies of Compassion" Bush has said he wants charities to get more involved in providing social services. Based on Cheney's history, you don't exactly picture him snatching up his Santa hat and racing off to clang a bell for the wee ones. That's problem one.

Problem No. 2 -- the more interesting one, for our purposes -- relates to that classic investing mistake: failing to diversify.

Not surprisingly, the former CEO of



is loaded up with company stock. Michael Zabalaoui, a certified financial planner and CPA at

Resource Management

in Metairie, La., says Halliburton alone accounts for more than a third of Cheney's equity investments. Throw in another holding,

Anadarko Petroleum


, and Cheney has 42% of equity investments concentrated in just two companies and one sector.

And boys, the chickens have come home to roost because, despite this year's steep rise in oil prices, Halliburton's looking pretty uninspiring. As Zabalaoui points out, the stock has a lofty

price-to-earnings ratio of 55, although its share price still hasn't surpassed its high from 1997. For most of that year the stock was trading in the mid-$50s. Now it's in the $30s and recently veered uncomfortably close to its 52-week low. "Over the last couple of years, Halliburton has been a losing proposition even as the overall market has gone up," says Zabalaoui. "He would have been much better off having invested in the


In September, Cheney caught lots of flak for hemming and hawing about what to do with a Halliburton options package then valued at $3.6 million. Though he said he'd forgo the options, that debate is starting to look academic, since the bulk of the options have recently been underwater. On Cheney's departure, Halliburton reportedly also gave the CEO a

retirement package of stock and stock options worth $13.6 million, though the value of the package would have diminished with the stock's decline.

Besides oil stocks, Cheney has a large position in

Morgan Stanley Dean Witter


. While it's unclear when he bought the stock, it's been an excellent performer, rising in the past three years from a split-adjusted price of $20 per share to $80 today. Other, smaller holdings are mostly Old Economy

blue-chips, like

Procter & Gamble



Union Pacific



Reader's Digest



Lockheed Martin


. More tech-oriented holdings include







Cheney also apparently got in on some lucrative

IPOs in 1999. According to a recent

New York Times

report, he quickly resold stocks that had skyrocketed from their offering price, racking up an 80% return valued at close to $46,000.

Equities make up 61% of Cheney's portfolio, with the balance in cash.

Zabalaoui suggests Cheney boost his equities allocation another 10%, while redirecting some of the cash into municipal bonds. He recommends an overall weighting of 70% equities, 20% muni bonds and 10% cash, although he says the exact proportions would depend somewhat on Cheney's cash needs.

He'd also like to see Cheney sell some oil holdings and funnel the money into diversified

no-load mutual funds. On Zabalaoui's shortlist of fund buys: an S&P 500 index fund,


Rydex OTC,

Strong Growth



TIP Turner Midcap Growth,


Strong Growth 20,


Fidelity Growth and



Setting aside the problem of overconcentration, Zabalaoui says, Cheney's portfolio is basically "in line with a wealthier retiree who's not in a position to need to take a lot of risk." That's a relevant concern, he adds, particularly in light of recent market volatility: "When you have $12 million, how much risk do you need to take?"