April Sees High Risk Aversion in MPF, 2.8 Billion Switching to Conservative and Guaranteed Funds

May 23, 2024
Reading Time: 6 minutes

【Hong Kong, May 23, 2024】GUM released the MPF Market Analysis Report April 2024 today. As of 30 April, the total assets of the MPF market rose by 0.1% to HKD 1.185 trillion.

In terms of market share, in 2024 YTD, Manulife’s market share has risen 0.12% due to inflow of funds, ranking first at 27.8%. HSBC and AIA have increased by 0.07% and decreased by 0.10% respectively, continuing to rank second and third at 17.6% and 10.9% market share. Together with the fourth-placed AIA (9.0%) and the fifth-placed BOC-Prud (7.3%), the top five providers account for over 70% of the MPF market.  [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%0.03%-0.13%-0.10%
7Hang Seng5.7%-0.01%0.04%0.03%

In April 2024, there were HKD 2.16 billion and HKD 0.87 billion switching out from “Equity Fund” and “Mixed Asset Fund” respectively. This marks the first instance this year where funds have shifted from “Equity Fund” and “Mixed Asset Fund” to “Fixed Income Fund”. [Refer to Table 2 for more details]

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

In April, the top five asset types with the highest net switching out were ”Hong Kong Equity Fund (Index Tracking)”, ”Hong Kong Equity Fund”, “Mixed Asset Fund (>80% -100% Equity)”, “Mixed Asset Fund (>60% -80% Equity)”  and “Greater China Equity Fund”.

On the other hand, the top five asset types with the highest net switching in included “MPF Conservative Fund”, “DIS – Core Accumulation Fund”, “Japan Equity Fund”, “Guaranteed Fund”, and “Global Equity Fund”. Among them, “MPF conservative funds” and “Guaranteed Fund” had a combined switch in of approximately HKD 2.8 billion in April, the fund flow reflects an increased risk aversion among members.  [Refer to Table 3 and Table 4 for details]

GUM’s Strategy and Investment Analyst , Martin Wan, pointed out, “Affected by the resurgence of US inflation and the geopolitical events in Gaza, the global stock market experienced an adjustment in April (especially US and Japanese equity). The market’s risk-averse sentiment intensified, with the “MPF Conservative Fund” and “Guaranteed Fund” collectively absorbing HKD 28 billion in funds.  On the other hand, the Hong Kong stock market rebounded by nearly 9% from its low in April, but there was still a total of HKD 25 billion flowing out of Hong Kong equity-related funds. However, with the strong rebound and increased trading volume of the Hong Kong stock market in May, the outflow is expected to decrease. 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 2024Q1 (in HKD million)

RankAsset Class2024 April
1Hong Kong Equity Fund (Index Tracking)(HK$1,248)
2Hong Kong Equity Fund(HK$1,219)
3Mixed Asset Fund (>80-100% Equity)(HK$697)
4Mixed Asset Fund (>60-80% Equity)(HK$580)
5Greater China Equity Fund(HK$483)

Table 4: Top Five Fund Asset Types with Net Fund Switching in 2024Q1 (in HKD million)

RankAsset Class2024 April
1MPF Conservative FundHK$2,300
2DIS Core Accumulation FundHK$698
3Japanese Equity FundHK$618
4Guaranteed FundHK$520
5Global Equity FundHK$235


-The End-

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