At the cross road

Recently, the market has ran up quite a fair bit and set to correct soon. The optimism comes from the fact that some indicator is turning up and investor who is itchy for some actions all jump into the bandwagon. The million question now is whether this is a bear rally or sustainable recovery?

I read a lot recently, about the various expert's view and research report. Just like the expert didn't forecast the severe downturn we are having now, the opinion now is also divided. Some say we are poised for recovery, some say beware.

I recognised that the "very worst" might be behind us now, because the credit is flowing again, albeit slowly. We saw many S-chip belly up, due to the worsening credit condition. Share being forced sold and growth went into negative territory.

It might be a good time to slowly adding some risk into the equity portfolio. We should buy when market correct each time. Avoid chasing the rally. Because I don't think the confidence is fully recover and everybody is ready to jump into equity. Mark Mobius said we would start to see another bull run, government is printing money which would cause inflation, stock is going to do well. This is true in certain aspect. But, there are many variables could delay the recovery.

Jim Roger said buy commodity and china share. Maybe I would add some exposure to commodity linked stock and my usual favourite, the china share. There is a commodity ETF on SGX also which can be considered.

Finally, nobody has the crystal ball. You can have your opinion, but the risk abound. Play carefully. Stick to big cap, more stable and the first to rally when recovery materialised.