GUM: The average earnings of Hong Kong's Mandatory Provident Fund in 2024 exceed HKD 22,000, the highest in nearly four years
As of December 27, 2023, the average earnings of Hong Kong Mandatory Provident Fund (MPF) participants reached HKD 22,869, the highest in nearly four years, with total returns increasing by 3.5% compared to 2023. The GUM MPF Composite Index return was 9.3%. U.S. stock funds are expected to yield a return of 10% in the first half of the year, while Hong Kong stocks are projected at 5%. Investors are advised to avoid European stocks and bond funds. Year-to-date, net outflows have primarily come from mainland and Hong Kong stock funds, while U.S. stock funds recorded a net inflow of HKD 17.8 billion
According to the Zhitong Finance APP, the Mandatory Provident Fund (MPF) consultant GUM stated that as of December 27 last year, the average earnings of Hong Kong's MPF were HKD 22,869, the highest in a year since 2020, with total returns significantly rising compared to 3.5% in 2023; during the same period, the GUM MPF Composite Index returned 9.3%, reporting 246.5 points. The highest returns for stock funds during the same period were from U.S. and Japanese stock funds, at 23.4% and 20.4%, respectively; Hong Kong stock funds (tracking index) also returned 20%.
GUM's Executive Director, Chen Ruilong, pointed out at a press conference that U.S. stock funds are the first choice this year, with expected returns of 10% in the first half of the year. The second choice is Hong Kong stocks, with expected returns of 5% in the first half, but he believes the market remains volatile, and domestic policies have not met expectations. The overall return expectation for the first half of this year is between 4% and 5%.
He also advised investors to avoid European stocks and bond funds this year, as both recorded negative returns last year. For medium- and low-risk investors, he recommended preset investment strategies - Core Accumulation Fund and MPF Conservative Fund, which recorded returns of 10% and 3.6%, respectively, last year.
On the other hand, as of November last year, the net outflow of funds year-to-date was mainly from mainland and Hong Kong stock funds; mixed asset funds with a high proportion of stocks. The highest net inflow continued to be from U.S. stock funds, with a total transfer of HKD 17.8 billion; followed by the preset investment strategy - Core Accumulation Fund.
In terms of December returns alone, the average loss per MPF was HKD 874; the GUM MPF Composite Index returned -0.3%