via stockadvisors

“We’ve come up with five ways to protect you assets and still  make a little money during these rough market environments,” says Glenn Rogers.

The market analyst and contributing editor to Internet Wealth Builder looks at raising cash, hedging energy and basic materials, and rotating into health care and financials. Here’s his five-point plan to “make it through the next few months.”

These last few weeks have been about as difficult a period as I can remember for trying to make money in the stock market, whether your view is short or long term.

“So what should we be doing now? I decided a strategic overview would be useful; I have been using these strategies myself in an effort to protect capital and position my portfolio for (hopefully) better times ahead.

“Raise cash. Reduce or sell some of your bigger gainers and losing stocks that are unlikely to rebound any time soon. I’m not suggesting a fire sale but when we get a rally consider selling into it and increasing your cash position to 25%.

“Hedge your energy position. I am still net long energy but I have been reducing my positions in energy-related stocks and have bought the ProShares Ultra Short Oil and Gas  ETF to 15% of my energy position. Once we get through hurricane season, I will likely increase that to 25%.

“Hedge your basic materials positions with the ProShares Ultra Short Basic Materials ETF that covers companies such as Monsanto, Dow Chemicals, and Nucor. This is not as pure a play as DUG but it is a useful hedge.

“Start rotating into healthcare. This sector has been pretty badly beaten up and should be ready to turn. I like Johnson & Johnson, Gilead Sciences, WellPoint and United Health. These are’t formal recommendations, only suggestions that you may want to look at.

“Start buying financials. I think that the time has come to start dipping your toe in the water, and I mean exactly that. Move slowly. Don’t build your whole position now; just start the process of adding to your financials weighting over the next couple of months.

“Individual names I like are Wells Fargo, US Bancorp, Toronto Dominion and Bank of America

ProShares Ultra Financial ETF offers the dual advantages of one-stop shopping and leverage. It’s not an investment for the faint-of-heart, but there is potential for a big capital gain for those who can deal with risk.

“The price tumbled from a high of $72.13 in February 2007 to a low of $14.75 earlier this month. That’s a gut-wrenching drop of almost 80%! But we may have seen the bottom.

“The components of the Dow U.S. Financials Index read like a Who’s Who of Big Finance. They include JPMorgan Chase, Bank of America, Citigroup, Wells Fargo, and Goldman Sachs. The ProShares Ultra Financials ETF is a buy only for aggressive investors.”

Track these picks and suggestions at:

http://trackthepros.com/categories.php?category_id=1425