Why Bring the Tracker Fund Into MPF?

Who proposed including the Tracker Fund in 2011?

In May 2011, a commentator urged the government to admit the Tracker Fund of Hong Kong — the passive Hang Seng Index tracker — into MPF, giving every account holder a low-fee, higher-return option. The author had proposed one-off MPF injections instead of tax rebates since 2007, and saw MPF’s low returns and high fees as a key reason the injection policy failed — problems needing a thorough fix.

Why do passive funds win?

Nearly every active fund can present itself as beating rivals, yet after high fees their actual results often trail the index; cheap passive index funds tend to do better over time. Members choosing now can find low-fee, steady performers at MPF fund comparison.

Would semi-portability alone fix things?

The author doubted competition alone would help: choosing funds is hard, and active funds’ fees devour returns. He also proposed encouraging voluntary top-ups with matching tax allowances — but only after fixing low returns and high fees first.