MPF Plunges 5.73% in May — Average Loss HK$7,361; Even 20%+ of Conservative Funds in the Red

Hit by the stock-and-bond storm, MPF tumbled nearly 6% in May 2011 — its worst fall since early 2009. Lipper data to 27 May: a 5.73% average drop, the worst month since the financial crisis (after September 2008’s -8.35% and October’s -12.19%).

How much did workers lose on average?

HK$7,361. April barely broke even (-0.01%), but on an average account of HK$128,465 (at end-March), May’s fall cost members HK$7,361 each.

Which fund types were hit hardest?

European and US equities, global bonds and balanced funds were all in the disaster zone. Even conservative funds — billed as lowest-risk — saw over 20% in the red on a one-year basis, with China Life’s conservative fund bottoming at -0.25%.

How to protect yourself in turmoil?

Two rules: don’t move personal-account or voluntary-contribution balances in one lump sum — switching in a falling market crystallises losses; and if betting on European equities, redirect new contributions to China/Hong Kong markets. Remember MPF is long-term — don’t switch constantly on short-term swings. Compare funds’ resilience at MPF fund comparison.