Hello all! First time posting and all that.
I am based in Hong Kong and simply put, I have not been adding to my index funds since late 2014. The reason is that I plan on buying a flat here in HK sometime in 2017 or 2018 and have therefore been saving for a down-payment (currently at a minimum of 40% in HK).
I initially (2 years ago) allocated about 75% of my savings to index funds, with 20% in high interest deposits and bonds, 5% cash. I now have about 50% in index funds, 10% in high interest deposits and the 40% cash. My index fund allocation is roughly 65% HSI (HK), 15% Asia-pacific ex-Japan, 15% Europe, 5% Indonesia.
My dilemma is that of course I want to invest my cash and grow it in index funds, but then I risk having to crystallise a loss if the market is down and I have a property I want to buy. On the other hand I want some form of security for a down payment, and cash is just about the safest thing out there, but it's a guaranteed loss against inflation lol.
The fact is my whole index fund portfolio is down (around 5%) from a brutal start to 2016, so I don't really want to sell that yet (at least not until I make a theoretical 7% year on year).
This isn't a market timing question (or so I think), it's more about risk management for real estate deposit - I think I know what to do but... what would you do?
