Even with the market already at record levels, you can still take steps to share in Wall Street's gains - and avoid potential losses. Here's how some leading analysts would do it:
Build a portfolio through "dollar-cost averaging." Invest a set amount on a periodic basis, such as $100 a month, and you even-out the value of your contributions over time. When the market dips, you will get more shares for your dollars, since prices will be cheaper. When the market climbs, you will get fewer shares.
"You need to set a goal as to what total amount to contribute," says John Markese, president of the American Association of Individual Investors in Chicago. Your dollar target will be based on your objectives, such as saving for retirement or for children's education.
Try windfall washing. If you are clutching a windfall, such as an inheritance or a monster bonus, move it into the market a little at a time.
Say you have $10,000. Mr. Markese would shift it into the market over a two-year period, in eight quarterly installments of $1,250 each. That protects you somewhat against the adverse impact of a possible downturn, he says.
This should be money you plan to keep in the market "for at least five years," says Markese.
Index, or not. In the current bull market, funds that mirror the Standard & Poor's 500 stock index have posted fabulous gains. But note the downside. Index funds tend to fall hard in a bear market, while other, more actively managed funds can ease the drop by putting money into cash or buying bonds.
Don't overlook the song the bears sing. Billionaire investor Warren Buffett sounds skittish about putting new money into stocks these days. He's not alone.
"I think the market will make further gains right into the summer, maybe getting to 8200," but then it could fall as much as 20 to 25 percent later this year, says Richard McCabe, chief analyst at Merrill Lynch.
"I wouldn't even do dollar-cost averaging right now," says James Stack, publisher of the InvesTech newsletter. "Wait until the market is down 10 percent, and then dollar-cost average." He recommends that for now, you buy US Treasury securities of short to intermediate durations - no more than 10 years.
Even the bullish Ralph Acampora at Prudential Securities concedes that if the Federal Reserve pushes up interest rates, the market could slump. That's especially likely if the yield on 30-year Treasury bonds moves above 7.25 percent, he says. But he reckons the Fed will be reluctant to push rates higher.