Voluntary MPF contributions: Fidelity’s Cheng Kim-wai on the “mandatory + voluntary” two-track strategy

In October 2011, with global equities in turmoil and MPF equity funds deep in negative territory for the year, Fidelity Hong Kong managing director Cheng Kim-wai disclosed her own setup: mandatory contributions all in an aggressive growth portfolio, plus monthly voluntary contributions directed into balanced and emerging-market funds, targeting higher long-run returns.

What are MPF voluntary contributions?

MPF voluntary contributions are extra payments made by employees or employers on top of the mandatory contributions, investable in any fund of the member’s choice. Cheng’s example shows their flexibility: mandatory contributions form the “core” aggressive holding, while the voluntary money is deployed separately — into balanced or emerging-market funds according to her risk appetite, free of the fund choices imposed by the employer’s scheme — which is the practical value of voluntary top-ups.

Bear-market stance: stillness beats motion

Amid October 2011’s sell-off, Cheng favoured “stillness over motion”. MPF cannot be touched until 65, making it ultra-long-term: in falling markets the same contribution buys more fund units; when markets recover, units bought at lows become the engine of returns. Frequent switching to chase the market tends to produce buy-high-sell-low.

Consolidate job-change accounts? She chose not to

She routinely advises employees to consolidate MPF accounts on job changes for easier management, yet keeps several accounts herself — her job requires dealing with multiple trustees to stay informed about the market. That is a professional exception; for most members, scattered accounts mean duplicated fees and complexity, so consolidation remains the better practice. The MPF education hub explains the account types.