As stock markets get whip-sawed by rising volatility investors should forget "lazy" strategies like holding onto stocks for the long term, Arjuna Mahendran, managing director at Head Investment Strategy Asia, told CNBC Thursday.
"The way to trade volatility is basically buy the dips and sell into strength rather then just hold through the cycle because you have to make your money work I'm afraid this year," Mahendran said.
"You can't be lazy and just sit back and hope that it will all end very well for everybody. It probably will but it's too much of a chance to gamble on," he added.
- Watch the full interview with Arjuna Mahendran above.
Investors are divided over whether corporate earnings will continue to improve or stall, which is leading to a lot of the market volatility, Mahendran said.
As well as uncertainty over earnings, the public deficit problems in Greece and the euro zone generally will also add to volatility, he said. Europe's budget problems will further depress the euro, which could add another layer of uncertainty for investors, he said.
Those factors are leading to sharp rise in risk aversion, according to Mahendran.
"Stocks themselves will I think get whipped around a lot because of this risk aversion. Fund managers will pull cash off the table from time to time," he said.
Mahendran thinks the euro could fall to $1.30 at some point in the next month.
Even though the stock market is likely to be rocked by volatility, Mahendran thinks investors are in for a "fairly good year overall."