INVESTORS who believe the volatility we have witnessed over the past nine months is an aberration - and normal service will be resumed shortly - should think again. This is normal service. Sensible investors will recognise this and adjust their strategies accordingly. The others will persist in the misguided belief that major market and economic adjustments are temporary and we shortly will get back to where we were. Asia's economic repositioning is far from over. When it is, we will be looking at a different world. One not necessarily worse, and probably better for being more realistic, but certainly different. Maturity forged by the fires that singed Asia's economies should be reflected also in investors' approach to unit trusts. When Asian markets were rocketing, many investors used mutual funds as proxies for equities, which is how they behaved. They often were as hot as any single stock, and in the China Club and the coffee shops, fund portfolios were boasted about like gifted children. Sadly, many of the prodigies have moved to the bottom of the class. One-year returns on funds invested in the Far East (excluding Japan) are deep in the red. The best are down more than 10 per cent over the period; the worst are off close to 70 per cent. Investors' obvious reaction to such performance - which has been bad enough to wipe out as much as three years of gains - is likely to be to search for another way of investing. Aware of this, the local unit-trust marketing men are going to be formulating new tactics to regain investor attention. Be ready for lots of educational campaigns, sage advice on the importance of diversification, and regular-contribution plans. One of the more radical messages comes from Templeton Franklin Investment Services (Asia) marketing and sales director Stewart Aldcroft, who says bluntly: 'Funds are not investments.' 'You can say that again' might be the retort of those for whom Asia's dream has become a nightmare. But what Mr Aldcroft is advocating is a change of attitude, with funds seen as part of a regular-savings strategy instead of a punt on a particular market in hopes of a rapid capital gain. A fund's performance, rather than being measured against an equity benchmark, should be compared with the return on other savings products. It is an approach that meshes well with the wish of many fund managers - that customers squirrel away cash regularly, as they would in a bank savings account, instead of making a one-off investment. Investors also benefit from this approach, which is called dollar-cost averaging. Those who use it invest the same amount in the same funds every month. When a fund's unit price is high, they get fewer units. When it is low, they get more - gearing up for when the price takes off again. Despite the meltdown in Asian markets, some local investors with savings plans have been surprised - not to mention relieved - to find the benefits of dollar-cost averaging have been noticeable, even during modest rallies. Regular investors have had the advantage of buying low and seeing value grow with the markets. This approach also eliminates the need to make timing decisions, which even the professionals rarely get right. Another advantage of the fund companies' regular-savings plans is that investors participate in the miracle of compounding, which ensures that fairly modest gains - by equity standards - mount up steadily. In fewer than eight years, a $1,000 investment, compounding at 10 per cent, would have more than doubled, even without topping up. As calculated by statistics company Micropal, $1,000 invested in a sample global fund five years ago and supplemented by savings increments of $100 per month would have been worth $14,677 by the end of March. This example also carries a message about the benefits of diversification - because investments in a similar scheme concentrating on Asian markets would have grown less, to slightly more than $3,000. Most fund-management groups marketing in Hong Kong offer regular-savings plans, and some do not even require lump sums to begin. So those who got burned last time can still start over.