If you had $100,00 to invest right now, what would you do with it?

[Virginia Dare]

assuming you didn't need it to pay any outstanding bills, other than a mortgage?

[A HERETIC I AM]

1. Did you mean ten grand or one hundred grand?

makes a big difference in allocation.

[Virginia Dare]

2. 100,000, but you can give your opinion on both..

if they differ, I'm just curious about what people think about investment choices right now.

[A HERETIC I AM]

3. In that case, and speaking STRICTLY FOR MYSELF, here is how i would put it to work.

First of all, in this range, ($10K to $100K) Mutual funds and/or ETF's would be the way to go. I say that because they are the most effective way to diversify across the sectors. Using individual stock positions with this much money makes it difficult to properly diversify because your positions become too thin.

If it was $10,000 I would stay with only 2 or 3 Mutual Funds, picking at least one that was Global in scope and included Bonds in its portfolio, one that was a pure growth fund and one that was growth and income, either using bonds as the income producer or value stocks to provide this. There are many examples of such funds but i will not mention any as i am not making any specific commentary on a particular fund or fund family.

If it was $100,000 I would take $50,000 of it and create a portfolio as above but add 2 or 3 more sector or class specific funds such as a Small Cap, a Mid Cap and a Global Energy fund, the percentages of which would depend on several factors, primarily though is time horizon. The other $50,000 I would seek a managed account of Exchange Traded Funds. There are few firms out there that do this but they do exist, trading in and out of sectors and classes including international plays. Trying to do something like that without true professional guidance is well nigh impossible unless you are willing to be glued to the news services 20 hours a day and know how to act and react to the most obscure incident. I am more than happy paying 2% as an annual management fee if the portfolio is making me my target.

People that feel they can outperform a professional money manager or that they don't need one might have success for short periods but in the long run, the pro or team of pros will blow them into the weeds on total return.

I would be looking for at least 10% average, year to year. That means i am willing to stand a year or 2 of negative 10 - 15% returns for a 5 year average of 10%. Don't panic and pull the plug because the market drops. A strategy that involves a properly diversified, well allocated, managed portfolio with a low Beta, decent Alpha and moderate Standard Deviation will serve well, regardless of quarter to quarter ups and downs.

The above is not a recommendation to purchase nor a solicitation to buy any specific investment instrument or allocation model. For illustration purposes only. Investing carries risks that can include loss of principal. Investors should carefully weigh all risks before making any investment.

[trof]

4. Invest in "$100 oil".

From yesterday's Forbes e-newsletter:

How do you invest for $100 oil? The best avenue is to seek those situations that make money as a consequence of $100 oil, not necessarily those that produce it. The exception is Apache (nyse: APA - news - people ). It fell as low as $72.65 recently, and purchases up to $78 are recommended. Apache is the one major that should be in your portfolio.

Balance your portfolio with Frontier Oil (nyse: FTO - news - people ) and Valero (nyse: VLO - news - people ). These refiners are unique in that they can process sour crude, and they are selling close to our downside buy prices. Both deserve a place in a diversified energy portfolio.

If you are hungry for yield, Blackrock Global Energy (nyse: BGR - news - people ) is still selling just below our downside buy price. Buy BGR up to $28 for a yield of about 5.4%. You can get nearly 6.8% with KinderMorgan (nyse: KMP - news - people ), but go easy with this one. I am still a little nervous about where Congress might go in their desire to tax partnerships.

You will see some of your dividends sheltered from taxes, but there is also a bit of extra accounting you will have to do on your tax forms due to the fact that this is a partnership and not a corporation.

Perhaps the best returns are in shipping crude. The two shippers on our list look great here. Nordic American (nyse: NAT - news - people ) yields about 12.8% at this price, and Frontline (nyse: FRO - news - people ) yields about 14.3%. The caveat is that these dividends are not consistent quarter to quarter. They fluctuate. Nevertheless, you should have a few shares of each of these in your energy portfolio.

Transocean (nyse: RIG - news - people ) also deserves a central place in your positioning for $100 oil. I have raised our buy price to $100 for RIG. Don’t be put off by the $100 per share price. Investing is a matter of percentages. If you buy 100 shares of a $25.00 stock or 25 shares of a $100.00 stock, the investment is the same. If either doubles, you will have doubled you money, regardless of how many shares you buy.

http://www.forbes.com/2007/08/24/transocean-apache-valero-pf-ii-in_ch_0824soapbox.html?partner=alerts