For security, I use two items, each with a different purpose.
I use a six foot (approx 2 meter) hardened steel chain and padlock. For low theft situations, I just run the chain through the front wheel and up over the handlebar and lock it. (Going over the handlebar makes sure I see it is there before I try to rid off without removing the chain). For higher theft situations, I will use the chain to chain the frame to something like a lamppost, telephone pole, etc. Yes, the chain can be cut, but it will take a good bit of time and hard work to do so.
The second item I have is an old Cobra brand alarm. It has two motion sensors (one in the unit itself, the other on a separate cable that I can put into my soft luggage on the top side). Movement of the bike will trigger an audible alarm. Will that stop theft of the bike -- not around here. But the alarm also come with a pager, which will beep to alert me that someone is messing with the bike. (e.g., getting into the luggage, or perhaps trying to cut the chain).
Nothing is sure to prevent professional theft, but at least you can make it difficult for amateurs.
k_enn