Julia asked 4 years ago
Hi I would like to ask, how do I know which fund I should go into? Yes one of the video states that we should choose 100% equity fund but what if the fund underperforms? How do we know how the fund will perform in the future? Do we look at past performance or we do evaluate it like how we evaluate stocks? Please advise. Thanks
KCLau Staff answered 4 years ago
We tend to not leaving a lot of money in the investment-linked policy, but just enough to sustain the policy to prevent lapsing.
When you buy insurance policy with one company, you have limited fund choice in fact. The equity fund also consists of many stocks, easily over 10 stocks. If you are “looking after” the return in an ILP fund, you can use the general market P/E ratio. When FTSE KLCI has high PE, you can switch to bond/income fund. When the index is low, you then switch back to equity.
But generally, we don’t leave a lot of money in the ILP. You can withdraw the excess cash value, without tax, without penalty, and invest on your own.