Gaineli: This Year’s MPF Returns Unlikely to Match Last Year’s — Keep Strategy Balanced

MPF consultancy Gaineli’s managing director Siao Mei-fung expects this year’s MPF fund returns to trail last year’s: 2008’s dreadful performance gave 2009 a big rebound runway; with possible stimulus exits worldwide and mainland tightening measures, this year’s showing looks pressured. She urges a balanced investment strategy rather than going all one way.

Why this year can’t repeat last year

When does semi-portability arrive? A fee war?

Siao expects “semi-portability” in Q2–Q3 next year, with the government finalising intermediary regulation. She advises employees to study fund returns and fees in depth now.

Fees have room to fall, but a price war is unlikely. Australia’s experience: about 5% of employees moved assets after semi-portability; she expects more movers in Hong Kong. More complex products — ETFs, developing-market funds — should follow.

What can workers do?

1. Stay balanced: neither all-equity nor all-conservative; diversify to your risk appetite.
2. Know your fees: use the MPFA fee comparison platform to see if your fund is pricey.
3. Prepare for semi-portability: you’ll get to choose your trustee — early research pays.

When markets turn rough, discipline and diversification are the best defence. Compare MPF funds’ fees and returns at MPF fund comparison.