If market jitters are making you nervous it may make sense to transfer some of your equity holdings into Government bonds. The major attraction of the latter is that your capital is guaranteed. Internationally investors are increasingly turning to the bond market for security.

But this flight to quality has depressed yields across the world and sent them to record low levels. With yields at such historically low levels the potential for capital appreciation has diminished and in some respects, for many Irish investors, the overall return may not be worth the candle.

At the moment 10-year Government bonds are trading at around 4.6 per cent and with the rate of inflation expected to average at about 2.6 per cent this year investors are only looking at a real rate of return on their capital of less than 2 per cent. However, this option may prove attractive to certain investors, particularly those who may be approaching retirement and are keen to protect their investment gains in the short term. Paradoxically though the increased appetite for investing in bonds is enhancing the attractiveness of the volatile equities and the property market for investors.

ABN AMRO economist, Dr Dan McLaughlin, suggests if you are prepared to sit it out for any period between one to three years then the equity market is still a better bet.