Dresdner Kleinwort, the top-ranked strategy team in the world, is advising investors to sell stocks and buy government bonds because the market correction is not over yet, reports Bloomberg.

"The long and widely awaited equity correction is upon us," wrote London-based Albert Edwards, a strategist at Dresdner, in a note today. "We are shifting our asset allocation stance to become much more aggressively underweight equities."

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According to Bloomberg, global stock markets have lost $1.5 trillion in market value since Feb. 27.

The Dresdner strategist is forecasting "an imminent shakeout of at least 10 percent" in equities. Renowned investor Marc Faber told Bloomberg yesterday that he expects at least a 10 to 15 percent correction in U.S. stocks, and a 30 to 40 percent adjustment in other markets such as China.

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The note advises investors to cut allocations for stocks to 35 percent of their holdings, down from 45 percent previously, and increase bonds to 50 percent, from 45 percent. Dresdner recommends investors raise cash positions to 15 percent, up from 10 percent. Dredner's neutral asset allocation model calls for 60 percent equities, 35 percent bonds, and 5 percent cash.

Dresdner has been voted the top global equity strategy team in Thomson Extel's annual surveys for the past three years in a row. Edwards and his colleague James Montier have held the title of best individual strategists since at least 2004, reports Bloomberg. Dresdner is a unit of German insurer Allianz SE.

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