$9.6B Switched into US Equity Funds, Approaching 2023 Full-Year Total for the Same Fund Type

Jun 20, 2024
Reading Time: 7 minutes

【Hong Kong, June 20, 2024】GUM released the MPF Market Analysis Report May 2024 today. As of May 31, the total assets of the MPF market rose by 2.4% to HKD 1.214 trillion. In terms of market share, Manulife remained in the lead with a share of 27.8%, followed by HSBC (17.7%) and Sun Life (10.9%) in second and third place respectively. Together with fourth and fifth-ranked providers, AIA (9.1%) and BOC-Prud (7.3%), the top five providers accounted for over 72% of the MPF market.

In 2024 YTD, the market share gains of Manulife and HSBC have been more pronounced. Manulife’s market share increased by 0.17%, mainly driven by net switching. HSBC’s market share increased by 0.08%, primarily driven by investment return. Sun Life and BCT’s market shares saw larger declines, decreasing by 0.13% and 0.10% respectively. [Refer to Table 1 for details]

Table 1: 2024 YTD Market Share of MPF Providers (Top 10)

 2024 YTD Change in Market Shares
Market Share RankProviderMarket SharesDue to Net SwitchingDue to Investment ReturnTotal change
3Sun Life10.9%0.04%-0.17%-0.13%
7Hang Seng5.7%-0.01%0.04%0.03%

In May 2024, “Mixed-asset Funds” experienced HK$0.72 billion net switching out, while “Equity Funds” and “Fixed Income Funds” recorded an net switching in of HK$0.06 billion and HK$0.66 billion respectively. “Fixed Income Funds” have experienced two consecutive months of net switching in, indicating that some members are trending towards a more conservative stance. [Refer to Table 2 for more details]

Table 2:Net Fund Switching in Major Asset Categories in 2024

In May, the top five asset types with the highest net switching out were “Mixed Asset Fund (>80-100% Equity)”, “Hong Kong Equity Fund (Index Tracking)”, “Japan Equity Fund”, “Mixed Asset Fund (>60-80% Equity)” and “Greater China Equity Fund”. Among them, Japan Equity Funds recorded a net switching out of around 530 million for the first time this year. Asset classes with higher correlation to the Hong Kong and Greater China markets also experienced relatively significant net switching out.

On the other hand, the top five asset types with the highest net switching in included “United States Equity”, “DIS – Core Accumulation Fund”, “Conservative Fund”, “DIS Age 65 Plus Fund”, and “Global Equity Fund”. In particular, the net switching in of “US Equity Funds” exceeded the total net switching in of the 2nd to 5th ranked asset classes, indicating very strong member demand. Additionally, the increased net switching in of the “DIS – Core Accumulation Fund” and “Global Equity Fund”, which have higher allocations to US and European equities, also reflect members’ greater confidence in the prospects of the corresponding markets. [Refer to Table 3 and Table 4 for details]

GUM’s Strategy and Investment Analyst, Martin Wan, pointed out, “As of May, the net switching in of “US Equity Funds” reached around HK$9.6 billion, approaching the total net switching in of US equity funds for the entire year last year. Excluding April, US equities have been the asset class with the highest net switching in in the remaining months of 2024, reflecting members’ continued confidence in the US equity market. On the other hand, “Fixed Income Funds” have recorded net switching in for two consecutive months, indicating that some members are starting to adopt a more conservative investment approach.

Nevertheless, MPF is a long-term retirement investment tool, and MPF members should take a long-term investment perspective, and should not overly predict the best entry timing to chase market volatility.”

Table 3: Top Five Fund Asset Types with Net Fund Switching out in 2024 May (in HKD million)

RankAsset Class2024 MayYTD
1Mixed Asset Fund (>80-100% Equity)(HK$598)(HK$3,784)
2Hong Kong Equity Fund (Index Tracking)(HK$537)(HK$4,102)
3Japan Equity Fund(HK$530)HK$1,627
4Mixed Asset Fund (>60-80% Equity)(HK$432)(HK$2,840)
5Greater China Equity Fund(HK$360)(HK$3,037)

Table 4: Top Five Fund Asset Types with Net Fund Switching in 2024 May (in HKD million)

RankAsset Class2024 MayYTD
1United States Equity FundHK$1,691HK$9,629
2DIS Core Accumulation FundHK$648HK$3,617
3Conservative FundHK$637HK$2,420
4DIS Age 65 Plus FundHK$166HK$1,018
5Global Equity FundHK$138HK$2,132


-The End-

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