Staying alert through the long dog days may be worth the trouble this year. The old investing mantra "'Sell in May and go away, come back after Labor Day" doesn't apply this year because of the delicacy of prevailing market conditions. As a result, activity could be brisk this summer as investment advisors and other financial-service professionals look to take advantage of every available opportunity.

"I don't believe that this is the time to stay away," says Manny Weintraub, founder of the private-client asset manager Integre Advisors. "In bear markets people focus on, and put a low multiple on, current year's earnings; in a bull market, they put a high multiple on next year's earnings."

And this certainly isn't a bull market, adds Weintraub, a former managing director with Neuberger Berman. "There's still a lot of negativity and a lot of uncertainty on the current year's earnings."

So investment advisors aren't likely to be nodding off when the June-quarter numbers come out after the Fourth of July.

Up to a point

Market watchers will also be on edge to see if Europe's economy holds up despite a strong euro, if China's economy comes out of the Olympics stronger or weaker, and the extent to which mortgage-backed securities can come back as issues.

Another reason to stay tuned this summer might be to buy discounted equities.

"I'm seeing a lot of cheap stocks -- stocks up 10%, 20% off the bottom that are still very attractive," says Weintraub. "It's a market where so many things have just gotten crazy cheap" in an environment where "corporations haven't fallen apart, and liquidity is starting to come back slowly."

Ferreting out undervalued stocks is fine, provided investors have a broad enough ownership of whole indexes to take advantage decisive upswings, according to Steven Lugar of Dallas-based BHCO Capital Management.

"Investors who are 'fishing for the bottom' today before they dive back into the market stand to lose big if they are not invested immediately after the market hits bottom and starts heading back up," says Lugar. "Those profits are gone for good to market timers who miss the boat on them."

In the 2000-2002 downturn, the S&P 500 gave up nearly 45% of its value. When the market turned, running up a 108% gain before 2007 was out, the index increased by 8.4% within three months of hitting bottom. The S&P 500 saw a 15% correction in 1990, and then a 14% gain in the first three months from hitting bottom on its way to a 43% gain through to the next peak.

BHCO is part of Zero Alpha Group a nine-firm network of independent investment-advisory firms that manage, in aggregate, more than $7 billion in assets for individual and high-net-worth investors.

New York-based Integre Advisors manages about $200 million, mainly for high-net-worth investors. -FWR

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