UPDATE: Outlook ’09 Year of the Trader


The profit and economic outlook is the cloudiest traders can ever remember and it may remain unclear well until 2009.

So said Fast Money Sr. Producer John Mellloy in his blog.

He also said, many believe we’re setting up for 12 months of volatile, trendless markets as the powers that be search to find the resolution that will make this bubble pop the least painful.

Fast Money trader Joe Terranova has some strong ideas about this kind of market and how to navigate it. On Friday’s show Terranova explained all.

“Shorten profit horizons, keep positions light and flexible, and use options more as insurance,” he said.

Terranova thinks every investor needs to become a trader. “Hit and run but don’t hold anything very long. That’s the script for 2009.”

Of course the other Fast Money traders have some thoughts on the matter too.

“I’d go back to big cap,big dividend plays. Companies that have high cash flow and low leverage,” counseled Tim Seymour.

“There are so many changes coming in 2009 it’s tough to have a long term trading strategy,” countered Zach Karabell. In other words, stay nimble.

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Trader disclosure: On Dec. 19th, 2008, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Seygem Asset Management Owns (EEM): Seymour Owns (AAPL), (BAC), (F), (MER), (DXO): Karabell Owns (AAPL), (GLD), (GOOG), (JPM), (UYG); Pete Najarian Owns (UYG)

Terranova Is Co-Portfolio Manager Of The Virtus Diversifier PHOLIO; Virtus Diversifier PHOLIO Owns (IGE), (DBC), (DBV)

Terranova Is Chief Alternatives Strategist Of Virtus Investment Partners, Ltd.; Virtus Investment Partners Owns More Than 1% Of (ABD), (ARE), (BIG), (OFC), (DLR), (EXR), (IGE), (MAC), (DBC), (DBV), (SKT), (UA), (CLB); Virtus Investment Partners Owns More Than 1% Of Seagate Tax Refund Rights

CNBC.com with wires