1. Liquidate and take a cash position.
If you are thinking that the stocks you currently own are not going up any further, then it is time to close out your positions and hang on to your hard-earned cash. There is not much upside to idle funds, but having them available to do other things, such as paying down debt or even saving them for a rainy day, will help you stave off the insomnia often facing bulls during bear season.

2. Diversify.
The old adage “Never put all of your eggs in one basket” applies here. During bull markets, equities are a great place to be. During bear markets, however, investors are cursing the word equities. Allocating various percentages of your portfolio among stocks, exchange-traded funds (ETFs), bonds, cash, and other assets will prevent all of your eggs from breaking should one of your baskets take a beating.

3. Buy insurance on your stock.
If you own something of value, like a home or a car, chances are you own insurance on it. Stocks should be no different. Many investors have equity portfolios worth even more than their homes and cars, yet they fail to consider protecting these assets. Usually called a “protective put” or a “married put,” this type of option can give you insurance on the stocks you own and offset your losses while allowing you unlimited profit potential on these long positions. If you are unsure about the near-term, downside-market risks on your long positions, this protective measure will still allow you to play the potential upside while protecting you from the downside.

4. Sell, sell, and sell.
As an investor you can either cut your losses as stocks are heading down or sell short (sell without owning) at a certain price and then buy the stock back as a lower price after it has fallen further. This strategy, called “shorting,” is not always readily understood by those new to the stock market. A more aggressive approach, it is not recommended for everyone but can be a great tactic when used correctly with protective measures. Although the topic of shorting extends far beyond this article, selling short can be a tremendous play as stocks are falling—especially since stocks can sometimes fall faster than they rise during times of fear in the market.

5. Invest in contra market funds or short funds.
Some investors have the pleasure of making money as stocks go down. Contra market, short, long-short, or bear funds are all types of funds that sell short, buy “put” options, or utilize some other approach to gain value as stocks lose value. You can purchase or go long with these funds instead of directly taking on the risks of shorting stock or playing options. The downside to these vehicles is they sometimes require a minimum investment amount, and the fund managers will usually charge an annual fee or an assets-under-management percentage, normally around two or three percent. If looking into one of these types of funds, be sure to find out all the fees involved beforehand.

6. Invest in real estate.
As in the stock market, there are a myriad ways to get started in real estate. One of the biggest reasons people do not is because of the perceived complexity. Sure, dealing with land and development can be tricky, but you can become a real estate investor on a very simple level if you know how. Owning a piece of property can bring profits through positive cash flow (when the income from the property exceeds the costs on the property), appreciation from repairs and upgrades on the property, or even increases in market value. Owning real estate can also allow you to deduct interest paid along with other expenses come tax time.

When all is said and done, first check with your broker, tax advisor, mentor, or coach to see which strategies might be right for you. Always take into consideration your risk tolerance, as well as your overall goals, when making decisions about investing. And remember, protecting the money you’ve earned is your number one objective. Making money when others are losing it—that’s even better!

Lance Garvin is a veteran trader in the stock market who has been a fund manager for two different hedge funds and held the NASD series 63 and 65.