Hewlett-Packard (HPQ) brought some much needed salutary news to investors in technology stocks Tuesday. Better-than-expected guidance helped put some life, albeit briefly, into the tech-heavy Nasdaq Composite index. That's something investors haven't enjoyed in quite some time. Sorry to say, but they'd better not get used to it.

As bad as the Dow Jones Industrial Average and S&P 500 index have been, the Nasdaq has been the true catastrophe. And we're not talking about just in the last year or so since the bull market ended. Pretty much any way you slice it, the Nasdaq has been a sinkhole for buy-and-hold investors. Take a look at the 10-year chart below. It's been more than just a lost decade. It's the land that time forgot.

This well-worn message is painful but it bears repeating: At the height of the tech bubble on March 10, 2000, the Nasdaq Composite notched its all-time closing high of 5049. We're coming up on nine years later and it's still down 70% from that peak. Like the Japanese know too well from their own experience in the 1990s, this is what a burst bubble really looks like. Unfortunately, it also makes long-term investing look like a recipe for buy and bust.

* Nasdaq performance over the last 10 years.

True, buy-and-hold is in the eye of the beholder (depending, of course, on when you buy and how long you hold), but a passive strategy indexed to the Nasdaq Composite over the last 10 years lost a nominal 25%. Over five years it's given up 20%, and in the past three years it's fallen by a third. Slicing and dicing the Nasdaq into those three-, five- and 10-year increments makes it look like passive long-term tech investors never had a chance. Even when they were ostensibly cheap, tech stocks proved to be very expensive, indeed.

That's why it's behooves investors to add a tactical component to a buy-and-hold strategy when dealing with something as volatile as the Nasdaq, says Joe Barrato, chief executive and director of investment strategies at Arrow Funds.

The key is to have a disciplined investment approach that takes advantage of the mini-cycles in between the secular bulls and bears. Read linearly, the Nasdaq's 10-year chart is one of pain and loss. Read another way, that roller-coaster ride is one of opportunity.

"The problem is people aren't disciplined," Barrato says. "They pull money out when they should put it in. If you are diversified across equities and bonds and you dollar-cost average into these down cycles, long term the payoff will be there."

The Achilles' heel of long-term buying and holding -- and one the Nasdaq chart illustrates starkly -- is that it offers no way to preserve capital or play defense. And, just as important, when to know to take profits. "Investors need to realize that there are very distinct cycles in the market," says Will Hepburn, founder and president of Hepburn Capital Management. "I mean, how long is 'buy and hold?' Most folks get the first part right. They might even buy low. But they don't know when to sell."

Common Sense columnist James B. Stewart, for example, follows a strategy of selectively selling when the Nasdaq climbs 25% and buying when it drops 10%. It's an inexact science, and it doesn't always work, but the approach at least raises the odds of buying lower and selling higher to lock in profits. The percentages can be tweaked to suit individual needs and philosophies, and a different benchmark can be used, but the point is to devise a simple system and stick to it.

Don't get us wrong: Buy and hold does have a lot going for it. Foremost it's cheap. Trading commissions are minimal, there are no short-term capital gains to pay, and index-tracking ETFs and mutual funds carry miniscule expense ratios. The PowerShares QQQ Trust (QQQQ), which tracks the Nasdaq, has an expense ratio of just 0.2%. The Vanguard 500 Index (VFINX), a mutual fund that tracks the S&P 500, charges only 0.15%. Buy and hold is also the simplest strategy to understand. Its downfall is that it works only about half the time, Hepburn says. "The other half of the time -- like the past year -- it can be a real disaster."

Will the Nasdaq ever come back? That's the trillion-dollar question to which no one knows the answer. If there's any certainty to be had it's that it will be a long, arduous slog. Barrato, for his part, figures it will probably take another 10 years for the Nasdaq to reclaim its March 2000 peak. After all, it took the Dow a couple of decades to get back to its pre-Depression levels.

What's a buy-and-hold tech investor to do in the meantime? Diversify. Maintain discipline. And don't become a prisoner to your buy-and-hold strategy. "You need to take advantage of the cycles," Barrato says. "Yes, the market's going to drop 10%. But then it's going to be up 20%."