FNC
Mike Norman
This week FOX News business contributor Mike Norman answers YOUR money questions. Ask FNC's business team your questions by e-mailing yourquestions@foxnews.com and check back each week. Plus, tune in to "The Cost of Freedom," Saturday starting at 10am ET.

Question: When the market is up, financial services are usually a good buy. I like Franklin (BEN) and Janus (JNS), but whom do you recommend? — Fred

Mike Norman: Fred, Franklin has had a huge run, and Janus is very overvalued, even at this level. If you want the number one global financial services powerhouse and a stock that is still ridiculously undervalued, buy Citigroup (C). You will not go wrong.

Question: My wife and I are in our early 50s and have about $1 million in investments, all in various mutual funds. Overall, we have about 14 percent in bond funds, 45 percent in foreign market funds, and about 35 percent in U.S. stock funds. I know we're pretty heavy in foreign market funds, but it's tough to ignore their performance. What do the "smart guys" (like you) recommend today for foreign versus domestic fund portfolio allocations? Thanks. — Steve (Nashville, TN)

Mike Norman: Steve, I don't know how smart I am, but I can tell you this — the hottest-performing funds of the past few years have invariably become the worst-performing funds of the years ahead. Having said that, I'd recommend scaling back on those foreign funds and buying some of the worst performers: short-term treasury and other interest-sensitive funds.

Question: What do you think of buying Zoltek Companies (ZOLT)? Has it already had its run? — Robert

Mike Norman: Robert, I don't get involved in buying businesses that have negative returns on capital and do nothing but lose money. When I get the urge to do something like that, I just go to Vegas. It's a lot more fun.

Question: What do you think of Air Products (APD)? I read they are the world's largest hydrogen supplier and a leading designer and builder of fueling stations, plus the largest supplier of gases for LCD flat screen TVs. It sounds as though their stock should really be taking off. Should I buy now or wait? — Diane (Easton, PA)

Mike Norman: Diane, may I rephrase your question as, "Why isn't their stock taking off?" The answer is, probably because everyone knows this story and the stock is fairly valued, if not slightly overvalued. Be patient, let everyone get frustrated, and the stock will pull back. Then you buy. I guarantee you'll have your chance.

Question: What happens to the common stock of a company in bankruptcy if it is purchased by another company? For example, if Adelphia is purchased by Time Warner? — Richard

Mike Norman: Richard, most of the time, the stock of bankrupt companies becomes worthless. The acquiring company would get the bankrupt company's assets and bondholders would probably get something on the dollar. Stockholders are usually losers, but don't quote me — I'm just an economist.

Mike Norman is a FOX News business contributor and the founder and publisher of the Economic Contrarian Update.