Winning Stocks: Buying Back In on the Cheap

However, if you have 10 years to wait out the market's ups and downs, Hanson said this is the perfect time to invest.

"There are a lot of extremely cheap companies out there," he said. "On Friday, the market was trading without regard for quality or the future."

Hanson said to be on the lookout for "companies that have great brands, really strong balance sheets with lots of cash and no debt, and significant international presences."

He mentioned Nike, Coca-Cola and Luxottica, an Italian company that makes Oakley and Ray-Ban sunglasses, and glasses sold under various luxury brand names including Bvlgari, Burberry, Chanel, Dolce & Gabbana, Donna Karan, Prada, Versace and Polo Ralph Lauren.

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"Don't just buy the things you know," Hanson said. Investing in just those brands limits you to consumer-product manufacturers and doesn't help diversify your portfolio.

"For most individual investors who don't really have time or inclination to be studying companies on a daily basis, the best strategy is to figure out how much you have to invest and then dollar-cost average that money into the market in small chunks," he said.

Find a mutual fund that reaches out to a wide swath of the market, put some money in it and then set up recurring stock buys every week, two weeks or month.

Hanson suggests opening such a recurring account with the fund itself to avoid fees you might have to pay your broker.

'Go Slowly'

Susie Johnston, a certified financial planner with Cherry Hills Investment Advisors, is a bit conservative in her approach.

"I think it's a good time to start," Johnston said. "I would go very slowly. I don't think this is over yet."

Nobody can predict the market's ups and downs, so she suggesting buying a bit today, easing in, and being very diversified.

Instead of buying individual companies, Johnston suggests mutual funds in which a fund manager buys and sells a basket of individual stocks. One thing to watch for with funds: the fees that are charged. There are many low-fee funds out there, but some charge high fees that can eat into your profits.

A fund that charges 1 percent or less of the money invested annually in expenses, known as the expense ratio, is considered low-cost. Avoid "load" funds that charge you a percentage when you buy or sell.