I came across a few articles lately that basically said a small allocation in junk bonds might not be such a bad thing. I definitely think the safer way might be through a fund, unless you do a lot of research into a particular fund. I checked out a few junk bonds and some of their charts are actually pretty attractive, plus they are on the plus side for the year. Some of them yield in the 8-10% range, but some of these are also trading at big premiums to their net asset values (NAV).
With the markets being down it's time to do a few things. If you're a long term investor then this is becoming a good time for you. It takes patience, but I suggest to spend some time researching companies. Some companies are just being brought down because of the market, fear, and macroeconomic variables. These companies are starting to become cheap (I think MSN money highlighted Coke -KO- today). If you're a shorter term trader, it might be time to branch out into some different asset classes. All the top performing etf's for the year have to do with foreign stocks. Lower market cap stocks (small caps, micro caps) tend to have less systematic/market risk on average, but more volatility. It would be interesting to see if some of the better performers of the last few weeks are in this category.
One last data: earlier today the markets were selling off and I noticed the Naz was trading at a 7.2% discount to its 50 day moving average. I don't remember seeing it that low in years!