The U.S. Federal Reserve launched another aggressive stimulus program on Thursday, saying it will buy $40 billion of mortgage debt per month and continue to purchase assets until the outlook for jobs improves substantially.
(Related: Read The Federal Reserve Statement Here.)
U.S. stocks spiked on the news, with Dow Jones Industrial Average jumping 100 points. The S&P 500 and Nasdaq were also in positive territory.
So how should investors be positioning themselves right now?
Options trader Jon Najarian thinks the price of gold is likely to push higher. Najarian noted the SPDR Gold Shares Trustexchange-traded fund, for example, had dropped to around $166 a share before the Fed announcement, only to shoot to the $170 level after the market learned of QE3. He suspects gold will continue its upward trajectory.
Later in the broadcast, Najarian said he also likes Seagate Technology at current levels.
In trader Joe Terranova's opinion, QE3 will likely prompt a rotation out of Treasurys and into stocks. To support his argument, he noted the 200-day moving average on the 10-Year Treasury Note is at around 1.83 percent, a level it has not been able to push past since early spring 2012. So if the yield on Treasury bonds remains low, Terranova thinks people are likely to gravitate toward dividend-paying stocks that are likely to produce a better return.
Terranova remains long any consumer-related stocks.
(Vote Now: Did the Fed Get It Right?)
Trader Josh Brown is also looking to dividend-paying stocks, such as Chevron.
"I would rotate out of the things that are screaming on this news and I would go back to the dividend payers," Brown said. "I would be skipping the cyclicals because I still think we're not out of the woods internationally and that's as big a story as this is."
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CNBC.com with wires.
When this story was published, Jon Najarian owned STX. Josh Brown was long CVX. Drew Sandholm owned the GLD.