Fighting inflation? Don’t forget risk — MPF is a long-term investment, not a chase for high returns

With Hong Kong inflation heating up, everyone is talking about growing assets to beat it. One finance column even suggested investors put money in high-growth assets this year — and switch MPF into equity funds to outrun inflation. Is that right? Not necessarily.

What is MPF’s investment objective?

MPF is a long-term retirement investment; its goal should not be merely beating inflation in the short run — risk matters too. Investment prices can rise or fall. Members should not fixate on high returns while ignoring risk, and should weigh their investment horizon, personal risk appetite and other retirement savings.

How should different age groups position their MPF?

Younger members, being far from retirement with a long investment horizon, can in principle allocate MPF to more aggressive funds such as equity funds for higher potential returns; even if markets reverse short term, the long horizon can smooth out volatility. Those nearer retirement should assess their risk tolerance and choose within a risk level they can accept.

What should workers do before positioning their MPF?

Assess your investment horizon, risk appetite and overall retirement savings first, then pick a matching fund mix. Explore MPF fund types and consult MPF investment education to position according to your circumstances.