Since I am expecting lower prices in the future, my clients have nearly 50 percent of their accounts in T-Bills and money market funds.  I am a bit concerned about the money market funds because I wonder what exactly do they own.  BIL, the T-Bill ETF works perfect as a substitute.  Last time I checked its holdings, it was laddered out the next ten T-Bills with about 10 percent invested in each T-Bill.  When you evaluate BIL, you will find it has a better yield than most money market funds, namely because of the much lower management fee.  I reduced all risky asset classes:  Large and Small Domestic, International and Emerging Markets.  When I go back into the market,  I will be slightly over-weights risk assets.

You must build your shopping list now because when the markets are falling apart, you need to keep your cool and execute your buys, not try to figure out what to buy.

Technology is number one on my list.  I do not know which company will be the star, so buy XLK.  Cisco (CSCO) is the only exception, any pull back on a market panic is a golden opportunity.

Emerging markets is second on my list.  I like EEM and EPP the most.  No allocation to emerging markets would be complete without ILF.  After the correction, I would over-weight this sector by as much as double my policy allocation.

I do not expect much of a pull back in energy or basic materials but you should have allocations to both.  Nabors Industry (NBR) has been below $30 again so I would look to buy some of it.  I am kicking myself for not picking up any at $26 last week.

If Whole Foods (WFMI) is another long term investment and I would like to add some below $45.