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Stocks Lose 4 Months of Ground in 2 Days

Stocks Lose 4 Months of Ground in 2 Days

The global coronavirus outbreak gashed stock markets again Tuesday, this time as threat was felt a little closer to home. While the U.S. hasn't reported any significant outbreaks yet, the Centers for Disease Control and Prevention said the country should consider its arrival a question of "when" rather than "if." All 11 market sectors were down. Every Dow component declined -- even Home Depot (HD, -1.0%), which beat profit estimates and said so far it wasn't anticipating a hit from the coronavirus outbreak. The industrial average did manage to close above the day's lows, but it still sustained a 3.2% loss to 27,081 -- its lowest point since Halloween.

There is no cookie-cutter advice for this predicament. Much depends on your own personal financial situation, risk tolerance and investment horizon. But you do have options. If you simply can't stomach this much risk, allocating more of your portfolio to cash is one way to protect against a bear market; indeed, knowing how to manage cash reserves is vital in retirement. If you want to keep your money working and do a little better than a savings account, bond funds (like those among our Kip 25 mutual fund picks) are holding up extremely well right now. But longer-term investors may need to repeat the mantra "this too shall pass" and stick to their guns, placing their faith in high-quality stocks and stock funds. Investors with money to allocate toward more aggressive growth might want to try swimming upstream. While coronavirus threatens to slow the pace of numerous nations' economies, it also has the potential to change consumer behaviors or accelerate trend changes already taking place -- which may benefit a handful of companies. The following is a list of 11 stocks that aren't immune to market drawdowns like today's ... but ultimately might be strong holdings if the coronavirus scare persists.

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