best strategy in volatile stock market

best strategy in volatile stock market : The stock market volatility of the past several months looks like it could stick around for a while, forcing investors to be ever more vigilant about how to position their portfolios.

Dividend-paying stocks are one of the more popular recipes for coping with uncertainty. U.S. companies are hoarding cash, making quarterly dividend payments to shareholders currently a much more reliable source of returns than capital appreciation.

Yet rapid sentiment shifts and potential bursts to the upside could leave buy-and-hold dividend investors flat-footed.

The better course is to be tactical in your stock allocation, say analysts, taking tax losses in cyclical sectors that suffer the most in a bear market and investing the proceeds in more defensive sectors, such as health care and consumer staples. Stocks in these sectors tend to have lower betas, a measure of how closely an investment's return matches that of the market,Food stocks, a subset of the staples sector, are another area that tends to hold up through tough times, For the latest updates on the stock market, visit Stock Market Today