I basically had almost no stock longs (apart from occasional short/medium-term trades) in 2008 until October, as I was nervous about a potential bear market. The difficulty of timing direction during that period is partly what prompted me to shift to more of a market-neutral long/short approach. I did start buying some stocks in Oct 08 but just outright purchases, I did not hedge with shorts. I was buying stuff like AAPL, CMG, IBKR, RSX, EWZ, GDX, and OIH from Oct-Dec 08 - some went up, some down, and I lost a few % overall as I was more long in the stuff that went down than the stuff that went up.
If anyone is interested. This trade is working out very well indeed (so far). See, it is possible to be a bear in this market and make money.
Good to see a sudden turn in the market reviving interest in this thread... I've been managing a straddle that was put on about three weeks ago. The increase in vol has certainly helped.