Why Judge MPF Funds by Dollar-Cost Averaging Returns?

How do DCA returns differ from cumulative returns?

To November 2010, Invesco’s MPF China/Hong Kong and Asia equity funds showed cumulative returns of 8.49% and 9.16%, but on a dollar-cost averaging basis the returns were actually 13.96% and 9.67%. Because MPF is contributed monthly, more units are bought in downturns and fewer in rallies, so DCA returns can differ wildly from headline cumulative figures. For employees, the DCA number is the truer measure.

How can you roughly calculate DCA yourself?

Compare the current price with the average price of units bought over the year. Note trustees buy on different dates (mid-month or the last business day), so check each trustee’s calculation basis when comparing.

What was the 2011 allocation advice?

Heng Yuen’s Jiao Yong then suggested aggressive investors hold 35% emerging-market equities, 15% emerging-market bonds and only 10% developed-market equities, and favoured Japan escaping deflation. Compare fund categories at MPF fund comparison.