Many people see volatility as a curse, but it doesn't have to be. Instead of working against you, volatility may, in fact, work for you if you follow a disciplined, regular savings plan under which you invest a fixed sum of money at regular intervals. Why?
Assume you are contributing $1,000 regularly for investment. When markets rally, your $1,000 contribution will buy fewer units. On the other hand, if markets drop the same amount will buy more units. This will result in a lower average cost than the average unit price, no matter which direction the markets move.
| Case 1 - If makets move up | Preiod | 1 | 2 | 3 | | | Regular contribution | $1,000 | $1,000 | $1,000 | Total Investment $3,000 | | No. of units purchased | 100.00 | 95.24 | 90.91 | Total units purchased: 286.15 | | Unit Price | $10 | $10.5 | $11 | Average unit cost $10.48
(lower than the average unit price of $10.5) |
| | | Case 2 - If makets move down | Preiod | 1 | 2 | 3 | | | Regular contribution | $1,000 | $1,000 | $1,000 | Total Investment $3,000 | | No. of units purchased | 100.00 | 105.26 | 111.11 | Total units purchased: 316.37 | | Unit Price | $10 | $9.5 | $9 | Average unit cost $9.48
(lower than the average unit price of $9.5) |
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The above are hypothetical examples for illustration purposes only.
So you don't have to worry about market timing. Nobody, not even the professionals, can be certain when a market or a fund has reached the top or bottom of its range. Yet some people still try. They constantly skip in and out of markets and tend to miss the best opportunities, because market turns tend to be swift, sharp and unexpected. We repeatedly hear stories about investors suffering big losses by "following the herd" - buying at high levels and selling at depressed levels. This is indeed cliche and yet many people just can't resist the temptation to follow the craze.
Indeed, staying invested is the best way to maximise potential returns. If you have a good strategy, a disciplined approach and the patience to keep your money invested for long enough, it's never the wrong time to invest.
Anytime is the best time to start a regular savings plan - and the earlier you start, the more the compound return effect can work for you. Remember, the longer you stay invested, the more you can take advantage of market volatilities.
| Annual return | Number of Years | Monthly Investment Amount |
| $1,000 | $3,000 | $5,000 |
5% | 5 | $68,006 | $204,018 | $340,030 |
| 10 | $155,282 | $465,847 | $776,411 |
| 20 | $411,034 | $1,233,101 | $2,055,168 |
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10% | 5 | $77,434 | $232,311 | $387,185 |
| 10 | $204,845 | $614,535 | $1,024,225 |
| 20 | $759,369 | $2,278,107 | $3,796,844 |
The above figures are for illustrative purposes only and are not indicative of actual fund returns.
- Affordable - From as little as HK$1,000 per month, you can start building wealth and step towards your long term financial goals.
- Flexible - You decide which funds to invest in and how much to save. You can also increase or decrease your monthly contribution (subject to the minimum investment), change your fund selection(s) and cash in your investment at any time you wish.
- Loyalty bonus - Enjoy a loyalty bonus once your have made 12 consecutive contributions. The longer you keep investing, the higher the discount on initial charge*.
| Contribution | Discount | | 13-24 | 1% | | 25-36 | 2% | | 37 Onwards | 3% |
* Normally 3-5% | |
| | - Wide variety of choices - Our comprehensive range of over 70 funds allows you to capitalise on investment opportunities all over the world.
- Convenient - Your monthly contribution will be invested automatically into your selected fund(s). With an online portfolio enquiry system, regular statements and a 24-hour hotline, you can keep track of the investments.
- Professional advice - Our highly experienced Investment Advisers can help you determine your investment needs and to select funds. And, with our Financial Health Check service and other analysis tools, you can even have your savings plan tailor-made – free of charge.
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To get started, simply contact our friendly Investment Advisers today or visit our J.P. Morgan Investment Centre in Hong Kong:
Tel:22651333
J.P. Morgan Investment Centre
Walkway Level, Jardine House, Central
Open Mon-Fri 8.30 am to 7.00pm; Sat 8.30am to 1.00 pm
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