With regards to our market’s performance during the first half of today’s trading, I would like to reassure investors that our market fundamentals remain strong and we maintain our optimistic outlook on our market's performance over the medium-term. The KLCI opened at 1,189.58 points and declined 8.17% to a low of 1,136.01. However, as of 12:30 pm today, at the end of the day’s first trading session, the KLCI has already seen some recovery, closing at 1,162.91. From our analysis, coupled with feedback from fund managers, analysts and brokers, it is clear that our market’s performance this morning is not an isolated incident.
The sharp fall experienced early in this morning’s trading session was a knee-jerk reaction to the regional market slide caused mainly by the sharp decline of the China indices yesterday. We will continue to monitor the situation but I am assured that our market will maintain its growth position in the long run. Our economy is stable and the outlook for 2007 remains positive. Our public-listed companies also continue to demonstrate progress and provide good returns to shareholders. (Statement From Dato’ Yusli Mohamed Yusoff, Chief Executive Officer, Bursa Malaysia Berhad, 28 Feb 2007)
To some the current KLCI sharp fall is bad news as they are lossing a lot of money. But I think this is a great opportunity to Public Mutual investors in the long term as they can apply the buy low sell high concept. This is a double boon for them as concurrently Public Mutual is running the Award Appreciation Campaign. They will be able to buy at a lower price per unit and at the same time get 1% free unit.
Some of the unit trust investors have switch their equity fund into bond to lock profit. But to do this you have to know where is the lowest point before KLCI bounce back, so you can switch back from bond to equity and make profit. The safer method is to diversify your investment into bond and equity for investor with a large amount of money. But to long term investors who do dollar cost averaging they don't have to do switching. The dolar cost averaging method will ensure that the units will be bought at an actual cost which is lower than the average unit price over the same period.
I think it is a hassle to do the monitoring yourself and to run around to the Public Mutual office to submit your switching form every time there is a great change in the KLCI. This is the job for your fund managers, that is why you are investing in the unit trust fund and not investing directly to the securities in the KLCI.