Pros: Create Alpha or Chase Beta?

Is the stock market pricing in a budget deal to avoid the "fiscal cliff"? The CNBC "Fast Money" pros took different tacks Thursday on how to play it.

Hedge your bets, Rosecliff Capital's Mike Murphy said.

"The market's pricing in that a deal is coming. I think you stay long," he said. "But you have to have puts under your holdings. Why? If we do not get a deal, I don't think that's priced into the market at all. I think there's major risk to the downside."

To Joe Terranova of Virtus Investment Partners, it was an investing decision whether to create alpha or chase beta.

Terranova said that he was buying shares of Goldman Sachs and Morgan Stanley – again.

"My expectation is we get a $20 print in Morgan Stanley, we get a $130 print in Goldman Sachs," he said. "Those are the beta-chase type of trades. In terms of creating alpha, I think you're sitting back right now. Yes, there's a Plan B on the 'fiscal cliff.' There's also a Plan C. So I think we've got the cover there. I think something does happen."

Looking to 2013, Terranova said that the market was poised to head higher.

"Even on a pullback, I think you buy the market," he said.

Simon Baker of Baker Avenue Asset Management called it "surprising" how resilient the market was.

"To be frank, I'm not buying anything today. We've been taking some profits. We've got a big pile of cash sitting on the sidelines and being really cautious," he said.

TheStreet CIO Stephanie Link looked to positive signs in GDP numbers, housing and manufacturing.

"I think the market actually wants to go higher because the underlying fundamentals are actually getting better," she said.

Trader disclosure: On Dec. 20, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC's "Fast Money" were owned by the "Fast Money" traders: Joe Terranova is long VRTS; Joe Terranova is long TJX; Joe Terranova is long AAPL; Joe Terranova is long GS; Joe Terranova is long SWN; Joe Terranova is long MS; Joe Terranova is long GLW; Joe Terranova is long DELL; Joe Terranova is long VZ; Joe Terranova is long XOM; Stephanie Link is long AAPL; Stephanie Link is long GS; Stephanie Link is long WFC; Stephanie Link is long SBUX; Stephanie Link is long YUM; Stephanie Link is long BBBY; Mike Murphy is long AAPL; Mike Murphy is short BAC; Mike Murphy is long C; Mike Murphy is long TGT; Mike Murphy is long YUM; Simon Baker is funds long CSTR; Simon Baker is funds long IWM; Simon Baker is funds long AAPL; Simon Baker is funds long AMAT; Simon Baker is funds long BAC; Simon Baker is funds long BBT; Simon Baker is funds long BBBY; Simon Baker is funds long BRCM; Simon Baker is funds long T; Simon Baker is funds long WFC.