Switching Funds

Switching is a process of transfering your investment from one fund to another.  Switching is done when there is a change in your outlook of the economic situation and you desire to preserve the profits you have gained or to reduce further losses or from an investor's changed perception of investment opportunities

Example: If you believe that the stock market has appreciated a lot and that further stock market upside is limited, you will then switch your Equity funds to a Money Market fund. Alternatively, if you feel that the market has bottomed out and further downside correction is limited, you will then switch your Money market fund back into an Equity fund in order to benefit from the market appreciation again.