The stock market's plunge yesterday is a warning for investors to reexamine their portfolios, but not a signal to pull their money out of stocks and put it in Treasury bills, a number of Washington area money managers and financial advisers agreed.

Several acknowledged, as Microsoft Corp. President Steven A. Ballmer told business journalists yesterday, that many technology stocks are overvalued, and that the "gold-rush mentality" that has been driving them may be subsiding. Such a development would send many of these stocks to prices more in line with what their earnings are, rather than what they might be later on, causing considerable retrenchment for some issues.

"Stocks are based on earnings. If there are no earnings and there have to be humongous ones" in the future for the stock price to make sense, "it's hard to justify some of these prices. The term 'irrational exuberance' comes to mind," said H. Lynn Hopewell of the Monitor Group in Fairfax.

"But I don't think you can say that about every tech stock," he added, because many technology companies have real markets and real earnings. And, he noted dryly, "Everybody who sold tech stocks in the past several years wishes they hadn't."

A reasonable approach for investors these days is watchful waiting, several advisers said. Investors lucky enough to have big gains in volatile tech issues may want to take some of the money off the table, and perhaps use the cash to add shares of big, solid companies, some of which have been beaten down recently, they said.

"If you've really been seriously under-allocated [in stocks] you might nibble right now," said Mary Malgoire of the Family Firm in Bethesda.

Malgoire said she is advising her clients to move slowly, however. She said improvement in foreign markets could suck money out of U.S. equities, and she also is uncertain about the impact of the year 2000 problem, especially in other countries.

"We are holding on to see where the volatility takes us," she said.

Thomas C. Grzymala of Alexandria Financial Associates said he thinks that while "the high prices we've experienced in technology stocks can only lead to a sharp correction, . . . I don't think this marks the beginning of a big bear market."

Grzymala says his policy is not to let any one stock exceed 6 percent or 7 percent of the portfolio's value, a rule that has led a number of his clients to sell some of their holdings of companies such as Cisco and Microsoft.

Some investors may prefer to simply pocket the proceeds at this point, but for others, he said, there are a number of good buys for the long term, such as Federal Express, Schwab and several pharmaceutical manufacturers.

Hopewell, a strong advocate of long-term investing, said investors should be prepared to live with market fluctuations.

"Markets go up and markets go down as they wind their way upward," he said.

"If you have to worry about the market going down 6 or 7 percent or 10 percent at any one time, you shouldn't be in it. You've got the wrong investment strategy," he said.