Question:
I have R500 000 to invest. I already have R300 000 invested in the stock market that is collapsing at the moment. Should I pull it all out and stick it into a money market account or keep it there while only depositing the R500 000 into the money market account?

Answer:
You need to take the time to consult with a financial advisor who can look at your entire situation and make recommendations from there.

With regards to your stock market investment, you need to understand that the market is cyclical by nature. You will experience highs and lows as long as you are invested. However, over the long term the stock market is still the single best investment you can make. It consistently outstrips inflation by a wide margin.

If you are happy with your choice of shares you should weather the storm, taking the money out now will be a grunted loss. Many people have become wealthy by buying up stocks when the market was low. The fools were the ones selling their shares.

The key to stock market investing is to invest with money that you don’t need in the short or medium term. If you have invested money and the fluctuations in the market don’t impact you then you are in a great position. However if you invest as a last ditch attempt to save for retirement or to try and make a ‘quick buck’ then you may come unstuck. The market will not always be where you want it to be when you need to cash out. It may be a good idea to consider taking an investment course. Have a look at www.finfit.co.za.