On Wall Street, you often hear the big money guys talking about "bullet-proofing" their portfolios.

In other words, designing your investment portfolio in such a way that even if your portfolio takes a body blow, it's easily absorbed with minimal damage to your investment assets. No investment plan is immune to losses – the idea is to limit those losses so they don't destroy your financial future.

Make no mistake, protecting your portfolio should be job one for investors, if only for good peace of mind. Research indicates that a loss causes about twice as much pain as a gain causes pleasure. During periods of market volatility, investors experience the sense of loss more acutely. For anyone with short memories, the bear market of 2000-2002 is a vivid example of that.

One example of bulletproofing your portfolio comes in the form of "Hurricane-Resistant" investment portfolios.

Remember Katrina? We all do. It wreaked billions of dollars of damage along the U.S. Gulf Coast in August, 2005. But some saw opportunity in tragedy. Writes Adam Shell, in a USA Today piece shortly after
hurricanes Katrina and Rita hit, "ever since Hurricane Katrina crashed into the Gulf Coast on Aug. 29, nimble traders and money managers have been reshaping their portfolios in an attempt to sidestep — and profit from — the potentially devastating one-two punch packed by Katrina and Rita."

In this case it's the notion that some industries and companies will profit handsomely from the damage inflicted by Mother Nature. Andrew Corn, CEO of Clear Asset Management told USA Today in the same story: "Like most tragedies, there is a silver, or in this case, a golden
lining."

This year the U.S. Weather Service is forecasting a big uptick in hurricane activity in the Western Atlantic, with the possibility of a whopping five "major" hurricanes reaching U.S. shores. Of course, I hope that doesn't happen. Lives will be lost, as will homes and livelihoods. But if it does, and you care to profit from it, there is a plan.

The key in building hurricane-proof portfolios is to pick the sectors - and the companies within those sectors – that are poised to profit from natural disasters. Obviously, construction and home repair providers - -think Lowes or Home Depot - -might be a natural for a disaster-proof stock portfolio. Energy and utility companies can fill a niche, too.

Even clothing retailers tend to do well in natural disasters. Companies like Abercrombie & Fitch and The Gap are often the first places shoppers go to replace - -what else? - - their clothing lost to a hurricane or other natural disaster.

While no actual hurricane mutual fund exists today, it's highly possible to cherry pick the companies you think will grow and prosper even as most others wither on the vine after a natural disaster like Katrina or Rita.

Remember, there's really no avoiding the ebbs and flows of stock market performance. Hits are inevitable and typically occur because of a bear market, a recession, inflation fears, or a currency problem. That's why the goal is to build-in protection for your capital, maybe even make a profit even when traditional portfolios are spiraling downward and still be able to beat or keep up with the markets when they are rallying.

That's why bulletproofing your portfolio is so critical – it protects you and your money and creates more opportunities to grow your investment portfolio.

Even after a hurricane.