Manulife plans two index funds, targets 20% MPF share by 2014

(Editor’s note: this report was originally in English and is rewritten in Chinese per this site’s practice.)

Hong Kong’s second-largest MPF provider, Manulife (International), plans to launch two index-tracking funds as it targets lifting its market share from 17.6% to 20% by 2014. Luzia Hung, vice president of employee benefits, said the firm has submitted the applications to the MPFA and is awaiting approval, with the new funds expected to roll out before year-end.

What will the two funds track?

“Something popular” among local investors. Hung did not name the benchmarks but implied a Hang Seng Index-tracking MPF could be one of them. The seven target-date funds launched in February have already attracted assets in the “double-digit” millions, she added.

Why is Manulife pushing now?

Index funds are cheap ammunition for the client grab. With the Employee Choice Arrangement on the horizon, providers are bulking up product lines — and low-fee index funds are a natural lure for members who will soon be free to switch. Manulife needs a broader shelf to take on leaders HSBC and Hang Seng.

To compare index-fund fees across providers, visit MPF fund comparison.