Is it time to move out of the stock market?

Dear Mr Tan,

My family and I have invested $130,000 in Growth and Balanced fund managed by Income for the past two years. The average returns is about 20%. In view of the record high of stock market achieved in the world, there is potential correction in the near future.

To preserve our investment, we intend to continue the investment with Income instead of surrender the policy. Please advice me should I switch to conservative fund or any recommendation from you.

EE

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Dear EE

In my case, I have decided to stay largely invested in the Growth Fund. It has 30% invested in bonds, so it is not so risky.

In the case of the Balanced Fund, it is 50% invested in bonds, which is less risky.

If you feel uncomfortable about the level of the stockmarket, you can switch to the Conservative Fund (which has 70% invested in bonds). You can switch back to the Growth Fund at a later date.

Two months ago, I sold by ST Tracker Fund and re-invested in the Money Money Fund. This fund earns an interest rate of between 3% to 3.5% per annum. Since then, the ST Tracker has moved up further. So, one can never find the right time.

Tan Kin Lian