The gyrations of U.S. equity markets on Wednesday -- the Dow Jones Industrial Average initially surged almost 200 points, turned negative, then finished the day up 122.10 points -- were yet another demonstration of generalized increased volatility.

These days, swings in the Dow of several hundred points seem to be the rule rather than the exception, and occur whether the news of the day is big, small or nonexistent. And these wide U.S. fluctuations affect and are affected by global markets that are at least as tentative and jittery.

As I have argued, this bout of market volatility will be with us for a while, especially as it is part of a bigger set of economic, financial, policy and technical transitions. In addition to larger up and down movements in both individual securities and market indices, it will result in occasional price overshoots, contagion within and across market segments, unusual asset class correlations and some sharp rebounds.

There are six major implications for investors:

* Be on the lookout for good names trading at really cheap levels: Sudden market air pockets, such as the one a few weeks ago (and there will be lots more), can drag down even the best securities, offering investors interesting opportunities. This is particularly the case for shares at the two ends of the market liquidity spectrum: securities with limited liquidity, which experience disproportionate moves because just a few small transactions can easily reprice the whole complex; and securities that are so widely held that they end up serving as ATMs for investors lacking liquidity from other assets.

* Use the periodic bouts of sharp market rebounds to trade up in quality: These sudden market retracements, such as the one taking place now, provide an opportunity for investors to upgrade their portfolio. In trading up into such securities, investors should be particularly mindful of the attributes that enable companies and sovereigns to successfully navigate the new (higher) volatility paradigm. These traits include robust balance sheets, low debt, good management and an operating edge that is hard for competitors to imitate.