Five-star fund manager Barry James sees a small rally coming, but he warns investors not to get caught in a bear trap.
"Some...technical things would tend to point that we should get a pretty good rally," he told CNBC. "In a bear market, they tend to come out of the blue."
He urged investors to use the rally to reduce the equity portion of their portfolios.
That said, he has a couple of stocks he really likes.
One is McDonald's.
"While they have pulled back a bit from their highs late last year, they still have held up better than the overall market," he said. "We really like the fact that they have so much overseas, in Europe, and they've shown an improvement here in the United States in terms of their same-store sales, which is something that's pretty unusual."
James also likes non-cyclicals like Archer Daniels Midland. His list of stocks likely to profit from a bear-market rally also includes quite a few techs: Lockheed Martin , IBM, Hewlett Packard, and Seagate Technologies.
"Seagate's at less than ten times earnings...Hewlett's got a lot of overseas sales," he said.