in Unit Trust, Fund Manager will always b ready buyer. You sell they must buy.

But u hv to wait minimum 10 days to get back your money (at least this is PM policy). Mutual Gold, business 2 days only

The more correct word should be redemption. *same as sell also.

This post has been edited by cherroy: Oct 19 2007, 10:50 AM

Repurchase carries the same meaning right?

redemption (by unitholders) = repurchase (by FM?) = sell (more laymen term/stocks term)

Hihi....I got a noobie question, hope anyone here could enlighten me

Normally when u guys wanna lock in profit by switching from an equity to bond/MM fund, do u guys
1) take out ALL ur units into the new fund OR
2) juz take out the capital and leave behind the profits OR
3) take out everything leaving behind 1000units or RM1k NAV inside to maintain average unit cost (another question...what is average unit cost in this context? )

What are the pro & cons of each move?
And how about the other way round when ya switch back from bond/MM-->equity fund? Which option is the best?

Hope someone could teach me abit....wanna learn.....thanks!!!!

NO. 1
Usually, when you do switch all your units into a new fund is when the fund is not performing up to your expectation. Therefore, you switch to other funds that has more potential.

Full switching may oso be done (to bond/mmf) when the market is down to preserve your capital. and will switch back into equity once the market is more stable.

NO. 2
This kind of switching is what we call profit taking. Once your fund perform to a certain target that u set, then you switch out some of your units to lock-in your profit. (i.e. take out your capital and leave your profit in there)

NO. 3
Mayb by leaving some low-cost units in your fund, when you buy in the fund again, it can helps to lower your cost per units.
Average cost means your average NAV cost/unit (include service charges +/- switching fees). Anyhting above this value is your profit.

as usual, do always take into the account of RM25 switching fees that is imposed as this will be included into your unit cost.

Pro and Cons?? If you switch too many times, in the end, you incur more loss than profit. Switching do save you the service charges for reentering the market. It oso useful in doing your asset allocation.

I would say, determine why you want to switch and when to switch.
not performing? preserve capital? market drop? profit taking?

This post has been edited by kingkong81: Oct 19 2007, 03:47 PM

So when the market is down, you switch to Bond? and when it goes even lower(an acceptable level) you buy at lower cost?

For me when I think the market is at top or has reached my target, I will switch to bond to lock the profit and wait for the next correction

My target for now is 20% to 25%, now 18.16% (as of last fri). So I will be switching out soon

This post has been edited by dzi921: Oct 19 2007, 04:46 PM

can i ask, any bond fund can recommend?

This post has been edited by SK2: Oct 19 2007, 04:48 PM

I have PISBF / PSBF

PIEBF (Bond + Equity) - Can go up and down faster compared to pure bond

Personally, I don't really bother about Bond's performance cause it is meant for parking

I think its relatively safe to buy any Bond. it doesn't flactuate as much. I have PBOND

haha..funny term..PARKING...but is the suitable word to use ...

Too bad PBOND sudah tutup Cannot open new account

Doesn't make much difference to you..haha. since you dun "park" much. btw. rule of tumb, how much do you keep aside in fix deposit, mutual funds or other investement?

so, u mean u buy bond fund just leave it as saving is it? and also can be paking area for equity fund? then is it u use little money to invest in bond fund only?
how about the PISBF? is it better to choose old or new bond fund? please enlighten me...

another question, is it better to have equity fund and bond fund? dun buy all equity fund?must be diverse to different type of fund is it?

This post has been edited by SK2: Oct 19 2007, 05:14 PM

You can see my portfolio diversified by % in my signature

Bond tend to drop slower then Equity

So my term of parking means, when market is quite high/expensive/unstable, I will be moving my funds from Equity into Bond for parking.

Reason, if the market has a correction, Bond will usually drop slower/little compared to Equity, meaning I'm locking my profit by switching Equity into Bond

Why am I switching into Bond and not parking in Equity for long term? Reason, to maximize profit

PS: This is based on my experience. I might be wrong

so is it adviceable for me to buy a bond ? cos it is better if i want to switch fund to equity to bond when market correction...

jes give me advice base on ur experience..thanks...dzi921..

Then if based on my experience,

Yes, you should at least open a Bond fund account. This is going to be useful during correction time. With a phone call (telemutual), you can switch from Equity to Bond easily

If you do not have that, you have to sell it off and can be troublesome (in terms of time and procedures)

The benefit of switching compared to selling off and buying again:-
You safe in terms of service charge (6.5%)

haha sorry i'm abit confused with these few statements...

so no. 1 full switching is done when market is going down to preserve capital, while no. 2 profit taking is when there's nothing wrong with the market but u juz wanna take out the profit because u hav reached ur own target issit?

ic ic.......but wouldn't performing a full switching after the fund has reached ur target be better than leaving behind a small sum of profit behind? Is there any advantage in leaving behind the profit? Wouldn't any future switching incur more costs due to the small sum? Let's say if after u take out the capital the market collapses, wouldn't the profit left behind shrink unless another switching is performed, which would cost another RM25? (esp for small time investors like me, that's a lot in percentage )

No. 3 dun understand haha how can leaving sum units in the fund lower my cost per units when I buy back? especially when I'm only switching between funds...no service charge other than RM25 (assuming it's PM) wouldn't buying more units at a go after a full switching have the same cost per units as leaving some in the fund then switching back into the same fund with the same amount of money?

sorry ar I abit slow in understanding thanks for ur lengthy reply~

This post has been edited by chidori_nep: Oct 19 2007, 05:49 PM

PISBF and PSBF is roughly the same. PISBF is focusing more into Shariah approved markets. From my observation performs a little better than PSBF; perhaps it has some off-shore investments.