Beat the “Sell in May” Slump With MPF — Don’t Switch Constantly; Dollar-Cost Averaging Buys the Dips

Hong Kong and global stocks sagged through May and June — the classic “five poor, six desperate” stretch. Seminar attendee Erica said her MPF returns had slipped and she was tempted to flee equities for conservative funds. The columnist’s answer: MPF isn’t short-term stock trading — don’t keep switching on short-term noise.

Why can long-term investing ride out short-term swings?

Economic cycles trend upward over time. Unless retirement is imminent, the investment horizon is long; economies wobble short-term but cycles generally rise, so long-run MPF investing should withstand volatility and build capital.

What is dollar-cost averaging?

Falling markets buy you more units. With HK$1,000 monthly contributions: rising prices buy fewer units, falling prices buy more — averaging the purchase price. Buying more units cheap in downturns lowers average cost, so the rebound delivers better returns.

What matters most when picking funds?

Your goals, risk tolerance and years to retirement. Market ups and downs are normal and unpredictable — don’t obsess over short-term performance or chase timing by switching constantly. Compare funds at MPF fund comparison.