What Is Dollar-Cost Averaging in MPF?

How does dollar-cost averaging work?

Dollar-cost averaging is a hallmark of MPF: invest a fixed sum in the same fund each month, buying more units when prices fall and fewer when they rise. Example: a fund rising from HK$10 to HK$15 over six months — buying 100 units monthly averages HK$12.50 per unit, but investing a fixed HK$1,000 monthly averages just HK$12.26. In volatile markets, regular fixed investing smooths costs and spreads timing risk.

Which return figure should members watch?

Because MPF is monthly, headline cumulative returns mislead; compare dollar-cost-averaged returns for the truer picture. You can roughly calculate it yourself by comparing the current price with your average purchase price over the year.

How should different ages choose funds?

The young should prioritise inflation-beating growth — conservative funds may lag inflation; near-retirees should avoid going all-in on high-risk equity funds. Bond funds aren’t risk-free either: ratings, rates, currencies and defaults all matter. Compare funds at MPF fund comparison.