Fighting Off the Bear

One year after the collapse of Lehman Brothers, these CNNMoney.com readers are repairing their portfolios. Here's what they're doing.

Buying Battered Financials

Courtesy: Lea Nesbit

Name: Lea Nesbit

Age: 44

Hometown: Dallas, Texas

I started adding bank and insurance stocks to my portfolio in the middle of November 2008 and bought through the end of March. I bought Royal Bank of Scotland, Genworth Financial, GE, Hartford, Lincoln National, Deutsche Bank, State Street, Wells Fargo, Bank of America and Berkshire Hathaway.

I wasn't sure if all the companies would make it out of the crisis but I felt many were victims of panic selling. Although they had short-term balance sheet issues, their business was fundamentally solid enough to recover and build long term shareholder value.

By early March, my portfolio had lost almost 40%. I had friends tell me they were liquidating their stocks because they believed we were in for the next Great Depression. But I fought my urge to panic and decided to see it as a great opportunity.

I held onto the stocks I already had and used the 15% of my portfolio that was in cash to buy more. I'm so glad I did. One year after Lehman Brothers, my portfolio is down less than 15%.

Keeping a Broad Focus

Name: Don A. Ash

Age: 80

Hometown: Keizer, Ore.

I am an 80-year-old retiree from the drug industry who retired in 1984. I was given a cash settlement in place of a pension and rolled it over into a stock market that has treated me very well over the years.

My portfolio is broad and I keep what I like to call a "personal mutual fund." My IRA has 15 stocks and funds and my brokerage account has 30. Some of my big winners over the years have been Biogen, which I bought in 1984, and Alcatel-Lucent, which I bought when it fell to around $1 from $64.

Like many people, I lost over 30% in the recent slide. The biggest losers for me were Washington Mutual, Bank of America and Microsoft. But in the last few months, I've gained some of that back. Citigroup, Terex, Maxwell Tech and Hyundai are all green as of now.

I'm still down around 20% from a year ago.

Maxing Out the 401(k)

Courtesy: Douglas Martin

Name: Douglas Martin

Age: 31

Hometown: North Brunswick, N.J.

I didn't have much invested before Lehman Brothers and the stock market collapsed, but once they did, I jumped on the opportunity and maxed out my contribution to my 401(k) plan.

Last fall, I was only contributing 1% of my salary to my retirement savings. But starting in March, I began contributing 10% so as to get the most from my employer match. That helped me recover the 60% I had lost between Lehman's collapse and the March bottom. I've now seen a 15% return on my contributions since March.

My Fidelity account has tanked the most, and I removed all my funds from them. My DWS RREEF Real Estate Fund and Oppenheimer International Growth Fund have led the way for my gains. I'm 31 so I know the market will recover well before I am ready to retire. I can weather the choppy trading.

Waiting out the Downside

Name: Gerald Ray Bruce

Age: 76

Hometown: Kingston, Okla.

I wanted to jump out of the market as soon as it started to slide, but my best advisor said "wait out the downside until you feel it's getting close to the bottom and then buy, buy, buy." I bought some as the market was falling, some when the market bottomed and some when it started to rise again.

I had lost 65% of my portfolio by March 2009, but have since gained back more than half of that. I also bought more as the market started to recover. My greatest losses were in Citigroup, Alcatel-Lucent, Level 3 Communications and Fannie Mae. El Paso, Motorola, Ford Motor and Bank of America pulled me back up.

One year later, my total portfolio is nearly 10% higher.

Staying the Course

Courtesy: Geo Verna

Name: Geo Verna

Age: 43

Hometown: Windsor, Calif.

My wife and I are in our early 40's and one year after Lehman Brothers and two years after the Dow's all time highs, we have not changed our strategy for saving for retirement.

Currently, we're 20% in bonds, 40% in large-cap stocks, 25% in small-cap stocks and 15% in international stocks. We're mostly in index funds and we revisit this quarterly and yearly, adjusting as needed. Both our companies offer 401(k) matching and we contribute the maximum. We also set up an automatic withdrawl from our savings each month into a tax-exempt bond fund.

From the high in October 2007 to the low in March 2009, our portfolio fell 43%. But as of September, it is down just 18% from the 2007 highs. Year-over-year its down 7%.

The two stocks that tanked the most are also the two biggest gainers since March: Powershares ETF Trust Golden Drg and Vanguard REIT Index fund.

Sure, as time goes on we will modify our allocation percentages, but we are staying with the path that we set to follow.

Cashing Out at the Highs

Name: Rolf Arands

Age: 43

Hometown: Piscataway, N.J.

When the Dow hit its all-time high in October 2007, I converted one of my largest holdings to mostly cash and bonds. I went on the assumption that it was time to clear out some money because the market highs were daily news. I continued to liquidate throughout 2008.

By the time the markets really dove south in March of 2009, I was about 60% in cash, 40% in bonds and annuities, and in a position to move back into equities. I reallocated my portfolio so that I was 50% in equities, 20% in cash, 6% in high risk and the remainder in low risk bonds and annuities.

As of this week, my portfolio is up 25% since the March lows and is at an all-time high.

Taking an Aggressive Stance

Courtesy: Rolf Arands

Name: Matthew Miller

Age: 30

Hometown: New York, NY

When I saw how much trouble Fannie Mae and Freddie Mac were in last September, I knew things were going to turn really bad, really quickly. The only other time in history that residential real estate tanked was the Great Depression. So I cashed out.

But by December, rock bottom prices on large equities, specifically distressed companies, made me want to jump back into the market. Though it wasn't the bottom, I aggressively bought all the way through March. Since then I've just been lightly trading.

As of the March lows, I was down 20%, but one year after Lehman, my portfolio is up more than 90%. The stocks that helped the most are Rite Aid, Unisys, Freddie, Fannie, Simulations Plus, Sirius and Ford.

Going forward, I plan to hold onto if not buy more of the losers and hold or sell the winners.