Uncertainty surrounds individual investors and their investment decisions. Economic growth has slowed, but we haven’t hit a technical recession and don’t know if we will. Analysts continue to tell us that the subprime mess is not over and home prices will continue to fall for the balance of the year. Oil and gas prices don’t seem to stop going up. The Federal Reserve appears to have ended their interest rate cuts with the hopes of supporting the dollar and avoiding extreme inflation.

With all of this uncertainty, many investors find themselves paralyzed when it comes to making investment decisions. However, there are a number of practical actions and steps investors can utilize to take advantage of the uncertainty.

Know when you are in control (and when you are not): Investors have the greatest control over their investments with the asset allocation decision. Everyone knows how difficult it is to consistently outperform the market, but the enticement of big gains and riches is often too hard to avoid. However, investors should first try to make sure they get the asset allocation decision right, before they worry about what investments they put into their portfolios.

Invest like institutions and endowments: What is called “the endowment model” has been getting a good deal of press as alternative strategies like commodities, hedge funds and private equity continue to perform relatively well versus the broad market. Strategies that were previously very expensive or only available to accredited investors are now available to all investors through ETFs, ETNs and mutual funds. Most investors will have some U.S. equities and some will have international equities. While diversifying your investments across different countries is a source of effective diversification, alternative strategies can typically provide additional diversification benefits.

Explore your “alternatives”: Some of the more popular alternative investment strategies are now available in cost-effective, restriction-free solutions. Alternative is the name used to describe investment strategies that break from the convention of only investing in bonds and stocks. Absolute return, natural resources, commodity strategies, active extension and real estate are good alternative strategies to the conventional. These strategies are similar to hedge funds and can be accessed through mutual funds, ETFs and ETNs. These product structures are more palatable to investors, as they don’t come with the expensive cost structure, high minimums, lock-up periods and accredited investor status required with most hedge funds.

Walk, don’t run into hot strategies: If you feel alternatives have a place in your portfolio, be cautious about your allocation to these strategies. Alternatives shine when they are paired with traditional investments like stocks and bonds, as they typically have different risk/return parameters and react to different economic and market factors. The best advice is to move slowly into these alternative strategies, especially the hot ones like commodities.

Don’t panic, stay invested: If the recent market volatility has you in a panic, your asset allocation may be off. However, if you take drastic action, like selling all your stocks, you could be violating one of the basic rules of investing: buy low, sell high. Use this experience to access how you truly feel about market volatility and how that volatility impacts your goals.

Jonathan Scheid is CFA and executive vice president of Bellatore.