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How to Play The Energy/Commodities Drop

Jim Huguet, president and co-CEO of Huguet Associates, said diversifying is the way to go. He sees growth opportunities in a variety of sectors despite the economic slowdown.

"You've got to look for terrific companies that have outperformed in this [volatile] environment," said Huguet.

Recommendations:

Stocks:

Natus —“The company specializes in testing of hearing in infants – their stock is up 20 percent this year.”

Dolby —“They have wonderful products and will continue to grow.”

"Companies that have been negatively impacted by the energy crisis will start to look better," said Huguet. He specified FedEx , UPS and General Mills. "Heavily commodities-based companies such as [General Mills] will see earnings go up as commodity prices fall."

ETFs:

XGC -- Invests in companies with strong earnings growth over time.

Sector Pans:

Huguet said he was still skeptical about the financial sector due to the weak housing market.

“I’d still stay away from financial stocks,” he said. “I’d be very selective about the stocks I invest in until housing prices stabilize in the United States.”

Disclosures:

No immediate information was available for Jim Huguet or his firm.

Disclaimer