With the markets so volatile, many investors might be tempted to head for the exits. But in these nervous times, there are smart moves you can make to protect your portfolio.
CNBC.com asked the experts what they would buy--and sell--in this type of environment. Here's what they're telling us.
Buy: Consumer Electronics
Marc Pado, chief market strategist at Cantor Fitzgerald, says technology-related industries such as software and consumer electronics should do well as corporate spending usually picks up in the fourth quarter. He also believes retailers could be set for a rebound.
"I think we'll test the lows in the next few days," Pado says. "But the two key areas that do well in the fourth quarter are technology and consumer-sensitive areas like retail, which has been badly beaten because everyone has been worried about the consumer."
Consumer electronics play on both of these themes and should garner investor attention.
"In the fourth quarter you get (corporate) spending and the holiday shopping season and despite the pessimism, it only provides us with a buying opportunity," said Pado. "I think we're coming off such a low point here that these stocks should outperform on a relative basis."
Consumer electronics retailer Best Buy is scheduled to report quarterly earnings on Sept. 18 and recently reiterated fiscal 2008 earnings guidance of $2.95 to $3.15 a share. Analysts surveyed by Thomson Financial currently expect earnings of $3.05 a share.
"The expectations are near their lows and therefore manufacturers of game consoles, flat panel TVs and MP3 players will be good this year," Pado says.
Pado also likes Apple , whose shares have declined more than 16% since hitting an all-time high on July 26 but remain up more than 40% for the year.
The strategist also said makers of video games should also see investor interest but declined to provide specific stocks. Shares of the industry's largest company, Electronic Arts, are up 2.4% year to date, while rival Activision has gained 5.5%.
Buy: Pharmacy Benefit Managers
Robert Doll, global chief investment officer of equities at BlackRock, likes pharmacy benefit managers such as Express Scripts.
"We just think the aging population and so many drugs going generic, the mail-order intent of the company, and its improvement of operating margins, all make this stock somewhat independent of the economy and it has excellent fundamentals."
Express Scripts competes with companies such as CVS Caremark , MedcoHealth Solutions and Healthextras .