3.73 Million “Lazy Fund” Accounts — but How Many Are Actually on the Glide Path? The Split the MPFA Has Never Published

Track 1 — Data Mirror | 37 days to the full-portability launch | Phase One begins 21 December 2026

The core proposition

Every quarter, the Mandatory Provident Fund Schemes Authority (MPFA) publishes the same sentence. As at the end of June 2026, 3.73 million MPF accounts had money “invested in the funds under the Default Investment Strategy (DIS)”, holding HK$188.6 billion — more than 11% of all MPF assets. The sentence is usually read as: a third of all accounts are being looked after by the “lazy fund”, with automatic de-risking after age 50, capped fees and global diversification.

But the sentence does not measure who is invested according to the DIS. It measures who holds either of the strategy’s two funds — the Core Accumulation Fund (CAF) or the Age 65 Plus Fund (A65F) — even a single fund, even a small slice of an account, even where the member picked the fund personally and never registered a DIS instruction at all. The MPFA’s own Simple Guide to Retirement Investment (2026 edition) states the consequence plainly: members who hold the two funds as standalone investments still enjoy the fee caps and the global diversification, “but the automatic de-risking will not apply to these investments.”

So how many of the 3.73 million are actually riding the glide path, and how many merely hold lookalike funds with nobody reducing their risk? The official statistics have never published the split — not once since the strategy launched in 2017. This is not a quibble about wording. The two populations pay identical fees. Their risk trajectories can be mirror opposites.

Data penetration: one number, two populations

First, where the number comes from. For five consecutive quarters the MPFA’s wording has not changed by a single character — always accounts “with investment in the funds under the DIS”:

In two years the count rose by 370,000 accounts and the assets by roughly HK$66 billion (+54%). Where the growth came from — uninstructed contributions defaulting into the strategy, members actively buying the Core Accumulation Fund, or a mix — the statistic cannot say, because it has never separated the two.

The conflation is in the statistic’s birth certificate. On 16 August 2017, three and a half months after launch, the MPFA’s press release was headlined “830,000 accounts now invested in DIS or DIS funds”: its text reported about 834,000 accounts “invested according to the DIS, in the CAFs and/or A65Fs”, involving about HK$15.4 billion — and in the same release noted, separately, that some members had “proactively chose[n] the DIS, CAFs or A65Fs”. The Authority already knew these were three different things; the headline and the statistical series merged them anyway. The same release records the one genuinely strategy-based population ever counted: of roughly 285,000 accounts sent a DIS Re-investment Notice, about 86% never replied and were re-invested according to the DIS by default, while some 300,000 legacy default accounts — mostly Industry Scheme casual-employee accounts — had no valid address to receive the notice at all. That by-strategy count has never been updated.

There is a second layer. Even an account-level split, if it were published tomorrow, would not be the whole picture, because de-risking does not attach to accounts. It attaches to each pot of money and its investment instruction. Within a single account, the existing balance, future contributions and transferred-in benefits can each carry a different instruction: one pot by DIS, another in a standalone Core Accumulation Fund — entirely legitimate, and common. Full portability, which opens on 21 December, will deepen the fragmentation: money transferred into a new personal account with no fund choice stated is invested according to the DIS by rule, while money a member actively places in the Core Accumulation Fund of that same account never de-risks. Both pots inflate the same 3.73 million headline.

And do the division: HK$188.6 billion across 3.73 million accounts is an average of about HK$50,600 per account. The headline counts accounts, not people — roughly 4.97 million members hold 11.2 million accounts, about 2.25 each — and the pool is thick with small, dormant and fragmented balances. As a measure of “how many members are protected”, the unit is wrong before the counting even starts.

The compounding cost: identical fees, a HK$83,200 difference in one fall

Be precise about what the missing split is not. It is not a fee issue. Standalone holders of the two funds pay under the same total fee cap of 0.85% (0.75% management fees plus 0.10% out-of-pocket expenses), and the actual average charge is about 0.77%, against a market-average fund expense ratio of 1.36% — a saving of 0.59 percentage points a year, worth about HK$1,475 a year on a HK$250,000 balance; on an illustrative HK$5,000 a month at a 7% gross return, the gap compounds to roughly HK$26,000 over 10 years, HK$160,000 over 20 and HK$559,000 over 30. On fees, the two populations are exactly equal.

Where they diverge is after 50. Invested according to the DIS, the statutory de-risking table moves about 6.7 percentage points a year from the Core Accumulation Fund to the Age 65 Plus Fund on each birthday. The Core Accumulation Fund holds about 60% in higher-risk assets, the Age 65 Plus Fund about 20%, so the blended exposure falls from 60% before 50 to about 44% at 55, about 31% at 60, about 25.3% at 62 and 20% from 64. A standalone holder of 100% Core Accumulation Fund stays at 60% for life.

The sandbox (illustrative, not a forecast): age 62, balance HK$800,000, higher-risk assets fall 30%. The by-DIS account loses about 7.6% — roughly HK$60,800. The standalone all-CAF account loses 18% — HK$144,000. Same funds, same headline statistic, a difference of about HK$83,200 in a single fall: roughly ten months of living costs at HK$8,000 a month. A 30% rise reverses the ranking by the same amount. The point is not which member is right; it is that two members holding opposite risk profiles cannot tell which one they are from anything the MPFA publishes.

Push the scenarios one step (scenarios, not estimates): if just one in ten of the 3.73 million accounts were standalone-only, that is about 373,000 accounts and, pro-rata, some HK$18.9 billion travelling with no glide path. At a quarter, it is about 932,500 accounts and HK$47.1 billion. Where the truth sits on that line, nobody knows — which is precisely the finding.

The way out: the split needs no new data, only separated printing

Trustees already hold this split. They execute birthday de-risking every year for by-DIS money, so the instruction status of every pot sits in their systems. What is missing is not data but publication. The MPFA’s comprehensive review of the DIS is, on the Authority’s own statements, to be completed by the end of 2026 — covering the fee cap, the age at which de-risking starts and the equity-bond mix. Before it recalibrates any of those, the elementary question is how many people the glide path actually carries. Without the split, the review cannot even size its own subject population. Our ask is three lines in the statistical digest:

1. Accounts — and assets — invested wholly according to the DIS;
2. Accounts — and assets — with any standalone holding of the Core Accumulation Fund or Age 65 Plus Fund;
3. Accounts aged 50 or above holding the Core Accumulation Fund without a DIS instruction: the highest-risk group, and the one most worth a reminder letter.

Members need not wait for the publication. Three checks, today:

1. Log in to the eMPF platform and read the investment instruction on each pot of money in each account — existing balance, future contributions, transferred-in benefits. Only an instruction that reads “invest according to the Default Investment Strategy” carries de-risking. A list of two fund names does not.
2. The age-55 test: if you are past 55 and every account still sits 100% in the Core Accumulation Fund, no glide path is running for you anywhere, however many “lazy fund” accounts you hold.
3. When you transfer after 21 December, state your fund choice on the form: silence defaults into the DIS (with de-risking); an active Core Accumulation Fund pick does not de-risk. Know which of the two you are choosing. Switching between funds inside a scheme is free of charge under section 34(1) of the General Regulation, apart from necessary transaction costs — but every instruction is priced at a forward, unknown price on a T+1/T+2 basis, so nothing takes effect the day you file, and none of this is a short-term trading tool.

The 3.73 million figure is not false. It simply answers a different question. The one thing a retirement safety net cannot afford is an unanswered question being quoted as an answered one.