The MPF involves 4.6 million scheme members and 330,000 employers. However, the Hong Kong stock market has suffered setbacks in recent years, and the amount of citizens' MPF accounts has shrunk significantly. Voices questioning the scheme have continued.
MPFA Chairman Mak Ka-hsuan Lau acknowledged in his blog this morning (27th) that the investment performance of different types of MPF funds recorded losses in the past year, but emphasized that MPF is a long-term investment and should not be viewed from the perspective of short-term investment , and pointed out that MPF has three advantages, including cost averaging, diversification and default investment strategy, in order to reduce the impact of market fluctuations.
MPF involves 4.6 million scheme members and 330,000 employers.
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Lau Mak Ka-hsuan said that the overall return of the MPF system is closely related to the asset classes invested by scheme members. "Market fluctuations will greatly affect the overall return of the MPF." Fund - MPF Conservative Fund, the rest of the investment performance recorded a loss.
However, Mak Ka-hsuan Lau emphasized that MPF investment is an extremely long-term investment and should not be viewed from the perspective of general investment for short-term speculation.
She pointed out that in the past 22 years since the system was implemented, it has experienced multiple economic cycles and financial market fluctuations. Among them, 14 years have recorded positive returns, and the years with losses can also recover in subsequent years.
Averaging helps to "even out" the cost of purchased units
She believes that the MPF design has three advantages, including cost averaging, diversified investment and default investment strategy.
First of all, in terms of the average cost method, the public does not need to predict the best time to enter the market or capture the market by investing in a fixed fixed amount.
She pointed out that the long-term and regular fixed savings investment method can help to "flatten" the cost of purchasing units and moderate the impact of short-term market fluctuations on investment.
She emphasized again that the MPF system is stable and can stand the test in the long run. Members do not need to worry too much about market fluctuations; Only short-term fluctuations will also become actual losses after selling.
MPFA Chairman Lau Mak Ka-hin.
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Diversification helps reduce risk
Liu Maijiaxuan said that in the total assets of the MPF, about 44% are invested in stock funds, and 35% are invested in mixed asset funds (that is, funds that mainly invest in stocks and bonds). The two types of funds account for the total assets of the MPF. About 80%.
She pointed out that all kinds of funds have recorded positive returns over a longer period of time, and stock funds and mixed asset funds have recorded cumulative net returns of about 1.4 times and 1.2 times respectively, reflecting that MPF can achieve cumulative appreciation.
She suggested that the public can make good use of the advantages of MPF to build a balanced investment portfolio, and called on the public to regularly review the MPF investment portfolio, and make investment allocations based on factors such as life stages, risk tolerance and personal investment goals, emphasizing diversification Investing helps reduce risk.
If you lack investment knowledge and time management, you can consider "lazy fund"
As for citizens who lack investment knowledge and time management of MPF, Lau Mak Ka-hsuan suggested that they should consider the default investment strategy, which is commonly known as "lazy fund", diversify investment in global stock and bond markets, and "reduce risk with age" An automatic adjustment mechanism can more effectively reduce risks and set a fee cap, which is a plan worth considering.
The MPFA pointed out that under the epidemic, the arrears of MPF contributions increased by 30%, and new measures will be launched to deal with illegal cases. The MPFA hopes to reduce administrative fees by 55%. The chairman suggests that members compare the cost performance of funds to choose Crostini. Monthly MPF involves 120 employees with about 120,000 in funds. It is reported on the Internet that they will receive a "mysterious envelope" for "permanently leaving Hong Kong" to withdraw MPF. MPFA: Never sent a letter
