To open up your portfolio for everyone's criticism is not only courageous but also admirable. MM did just that. It reminds me of the Tiger 21 group of rich investors. The group requires a minimum of $10 million in liquid assets and $25,000 annual dues. I think it's great to have peers criticize on everything from your life to your investments, but paying $25,000 a year for that is pretty ridiculous (however, it's important to note that $25,000 is no more than 0.25% of a member's net worth).

Even so, when it comes to investment advice the $25,000 may be justified if it functions as a filter that keeps out senseless advices and retains only the best ones. After all, the advices you'll be getting from such an expensive filter will only be the ones coming from already successful people if not investors. Opening up your portfolio for comments in the public on your blog will definitely require you to have a pretty good filter in place because everyone has something to say.

Having said that, you should know not to take my "advice" too seriously.

1) Mutual Funds
I don't invest in mutual funds and am not a big fan of diversification as many already knew. You do have a good selection of possibly some of the best mutual funds out there. I have not done much research in mutual funds so I am basing my opinions solely on my knowledge about the managers. OAKMX is run by Bill Nygren, an investing guru. TAVFX is run by Martin Whitman, also a value investor guru. I am not familiar with the other fund managers. That, of course, doesn't mean they are no good. But I think you know what I'm getting at. When it comes to mutual funds, the most important factor to consider is the fund manager. Answer the question "Would you let this guy manage your money or would you rather have someone else do it?" and you may just think about investing in mutual funds differently. It's important to note that one should pay no attention to past performance no matter how good they are. Clearly, past performance in no way indicates a similar future performance. A good manager, on the other hand, does.

2) Stocks
I disagree with some of the comments about you being overexposed in the insurance industries. I think the insurance industry is generally selling at a bargain since the hurriances in 2005. AIG is possibly one of your best investments assuming you got in around the middle of 2005 when the SEC investigations with regards to the reinsurance scandal began.

Your strategy of holding no more than 10 issues makes sense. Unless you can follow them, you shouldn't own them. But it's also important to realize that this 10 stock-rule should not be a hard rule. I like to think of it this way. If I think I can reasonably keep track of no more than 5 stocks, it doesn't mean I shouldn't buy a different stock just because I don't want to violate my 5-stock rule. What if the margins of safety for the 5 stocks I currently own have disappeared? I shouldn't be buying more of the 5 stocks. I should be buying some other stock that is selling at a bargain.

I'm not sure whether you're a value investor or an income investor. The difference is subtle, but based on your appetite for high-yielding blue chips you could be leaning towards income investing. True, high-yielding blue chips are generally well run companies that are less risky. But I think it pays not to place too much emphasis on the dividends. After all, they are taxable at your income tax rate, not the lower capital gain tax rate.

Regardless, at first glance, you seem to have a solid portfolio of good stocks. Of course, it all depends on the prices you paid for them. It would be helpful if you could disclose the cost of the securities in your next posting and the performance thus far.

There are two stocks I'm not quite certain about: MO and PFE. Altria's primary business is tobacco. Given that California is becoming a smoke-free state, the trends appear to be working against tobacco companies. Of course, Altria also owns a sizable percentage of KFT. But if there are less and less smokers, Altria's earnings could be affected.

As for Pfizer, it all depends on the reason you bought the stock. To me, a drug company faces tough challenges in defending its economic advantages. A drug company like Pfizer makes money by developing new drugs, patenting the formulas and selling them at huge profit margins while the patents last. Once the patents run out, the cycle repeats. The problem is there are so many things that can go wrong with developing new drugs. What if the drugs did not get FDA's approval? What if there were serious side effects like Merck's (NYSE: MRK) Vioxx? Granted Pfizer has a stable of name brands of daily consumer products such as Listerine, BenGay and Sudafed, their primary revenue still derives from new drug developments. Nevertheless, if you bought the stock because you believe it was just severely beaten down and do not intend to keep it for the long term, your actions are perhaps well justified.

Finally, given your portfolio, I may have bought one share of the Berkshire Class A (NYSE: BRKa) share and be done with it. Of course, you'd still have to worry about the remaining $30k you still plan to allocate to stocks. But you'd save a bunch on commissions and the total return of your entire portfolio would probably still be the same. But, that's just me. :)

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