Near Retirement Can Still Mean Aggressive: Use MPF as the Satellite, Chase Equity Funds

In this year’s first seven months, equity funds topped the MPF leaderboard, far outpacing the still-falling Hang Seng Index. Lau Pui-shan says nearing retirement doesn’t mean going conservative: if MPF is only a small slice of your total assets, treat it as the satellite, overweight equity funds and seize short-term opportunities — retirees can invest aggressively too.

Core vs satellite

If MPF is your portfolio’s satellite, near-retirees can stay aggressive instead of sighing at soaring equity funds. This year’s top ten gained 6–10%; Manulife Healthcare and BEA Union European Equity held the top two, up nearly 10% year-to-date.

What if MPF is the core?

Still no need for excess caution: twenty post-retirement years need growth against inflation. Look at target-date funds — even the nearest-dated retirement funds keep heavy equity: AMTD Invesco Target 2018 at 49.54% equities, Manulife MPF 2015 at 57%; Fidelity “Savings Easy” 2020 and BEA Union Savings Easy 2020 hold only ~5% in Hong Kong/international bonds, the rest equity funds.

The point

Aggressive or conservative depends not on age but on MPF’s role in your total wealth. Know your whole balance sheet before setting MPF aggression. Compare MPF funds’ fees and returns at MPF fund comparison.