MPF Survived the May Slump: How to Face June?

MPF Survived “Sell in May” — How to Face June?

June 2011 reports: lifted by six straight Hang Seng gains, MPF eyed a sixth straight monthly rise; May equity funds averaged -1.2% to -5%, only global bonds eked out a small gain, leaving May roughly flat to +1% and the first five months up about 8%. “Sell in May” survived — but June’s gloom loomed.

What did experts see for the second half?

RCM’s Yu Tianyou: the peripheral-Europe debt mess was unresolvable near-term — still bearish; the US low-base effect was fading and momentum slowing. But he stuck with stock-picking over market-timing, favouring healthcare and tech; Asia led by China and Hong Kong looked better as mainland inflation neared its peak.

What mix did he recommend against June?

Build your own balanced mix: Asia-focused equities, target-date funds that shift equity-bond mix with your retirement horizon, and money-market funds. Money-market beat bonds here, spread across USD, EUR and other currencies.

What should workers do?

Don’t time markets — allocate by your horizon. Compare MPF funds for target-date options.