With the markets still in decline, Morgan Stanley and Merrill Lynch, both of New York, recently mounted aggressive marketing efforts to calm investors' nerves. The message? Buy low, sell high. And if you don't want to be in equities or mutual funds, look into alternatives.

Fund companies need to do more to stem the panic, observers said, including simply talking investors through their troubled impulses to sell out and emphasizing how their own portfolio managers are coping.

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