Today's Hot Topics   ▲  |  ▼

10 to Buy on Dips
I've divided my watching and researching into four categories:

• Stocks that I sold and would like to rebuy after a drop of 10% or so.

In this group, I'd put recent sells Cummins, down 5.7% from my sell as of the close on February 22, and Nestlé, down 1.5%.

• Stocks that I've been waiting to buy, but that have run up too far lately.

In this group, I'd put Cheniere Energy (LNG), Marathon Petroleum (MPC), and eBay (EBAY). I'd look at this group  if the stock prices dropped 10% or more.

• Stocks that never seem to get cheap.

You're likely to get these only if the correction gets really serious—more like 15% than 10%. I don't think we'll get there, but I don't want to let a correction like that go to waste if we get one.

In this group, I'd put Middleby (MIDD), Precision Castparts (PCP), and Pioneer Natural Resources (PXD). And if I get these, I intend to paste a Post-it to my forehead saying, "Don't ever sell."

• Stocks that are more volatile than the general market, and that are likely to get hit harder than the general market in a downturn.

You can easily see the downside, since some of the stocks in this group have already taken a beating in the last couple of weeks. But look back to the earlier stages of this rally to remind yourself of the upside potential.

For example, Yingli Green Energy (YGE) was up 171% from November 23 through February 12. But the shares of this Chinese solar company then fell 14.6% in a matter of less than two weeks, from February 12 through the close on the 22nd. (Yingli Green Energy is a member of my Jubak's Picks portfolio.)

You've probably got your favorites in this group, but I'd like to suggest one that you may not have thought of: Australian coal miner Whitehaven Coal (WHITF), traded as WHC.AU in Sydney. The shares climbed 30.6% from November 16 through January 23 before retreating 17.9% from January 23 to February 21. Last week, shares were almost back to the level of November 16.

Those are my ten. You can also fill out these groups with picks of your own. It's not yet time to do any buying, mind you. Just get prepared for what the market might throw at us.