GUM: Global Stock Markets Continue to Decline in September,  YTD 2023 Average MPF Loss of HKD 471 per Person

Oct 9, 2023
Reading Time: 10 minutes

[Hong Kong, October 10, 2023] – In September, the MPF performance continued to decline, influenced by the ongoing instability in global stock markets. All three major GUM MPF fund indices experienced a decrease. 

As of September 30, the “GUM Comprehensive MPF Index” dropped by 2.8%, closing at 217.40 points. The “GUM MPF Equity Fund Index” declined by 3.6%, closing at 285.59 points. The “GUM MPF Mixed Asset Fund Index” decreased by  3.2%, closing at 217.16 points. The “GUM MPF Fixed Income Fund Index” reported a decline of 0.4%, closing at 123.14 points. In September 2023, the average loss per person in GUM MPF was HKD 6,651, resulting in a year-to-date loss of HKD 471. 

GUM Strategic and Investment Consultant, Martin Wan, stated, “In September, the stock and bond markets continued to face pressure due to expectations of high interest rates, concerns over US-China relations, and the ongoing Hong Kong property crisis. The MPF outlook for the 4th quarter largely depends on the performance of the Greater China region, interest rate trends, US-China relations, and geopolitical events such as the Russia-Ukraine conflict.” 

Table 1: Overall performance of MPF and average return in September  

Index Value September 2023 Return (%) 2023 YTD Return (%) 
GUM MPF Composite Index 217.40 -2.8% -0.2% 
GUMMPF Equity Fund Index 285.59 -3.6% -1.9% 
GUM MPF Mixed Asset Fund Index 217.16 -3.2% 1.2% 
GUM MPF Fixed Income Fund Index 123.14 -0.4% 1.1% 
Average MPF Gain/Loss Per Member Note 1 (HK$) -6,651 -471 

Review and Outlook 

Both the Chinese and Hong Kong stock markets continued to falter this month. The Hang Seng Index dropping below 18,000 points, primarily dragged down by the real estate sector. Additionally, the recent low trading volume in the Hang Seng Index reflects investors’ cautious attitude. Despite various stimulus measures implemented in China since August, there hasn’t been a significant rebound in the Chinese and Hong Kong markets. 

In the global market, all three major US stock indices experienced declines, influenced by expectations of interest rate cuts by the Federal Reserve. Inflation data also rose to 3.7%. Inflation concerns are also impacting Europe, as the European Central Bank unexpectedly raised interest rates by 0.25% last month, creating the possibility of a higher interest rate environment than initially anticipated. 

Analysis of Equity Fund Performance 


Consumer data for August showed faster-than-expected growth. The total retail sales of consumer goods reached CNY 37.9 trillion, with a year-on-year growth rate of 4.6%, surpassing market expectations of a 3% increase. The Purchasing Managers’ Index (PMI) rose to 51.0, an increase of 1.8 percentage points from July, indicating a return to expansion. These figures suggest that the worst situation for the Chinese economy may have passed. 

Hong Kong  

The Hang Seng Index closed at 17,500 points, the lowest level in 2023. However, there were some positive signs in the data, as Hong Kong’s unemployment rate remained at 2.8% in August. Secretary for Labor and Welfare, Chris Sun Yuk-han, stated, “The continued recovery of the tourism industry and local consumption should support the labor market in the coming months.” 

United States  

All three major stock indices continued to decline. While the Federal Reserve kept interest rates unchanged at its September meeting as expected, the updated Fed’s dot plot indicated the possibility of another interest rate hike this year and reduced the number of expected rate cuts in 2024 by two, compared to the previous update in June. Additionally, the yield on the 10-year US Treasury bond rose to 4.74%, which negatively affected the stock market. 


Influenced by high inflation, the European Central Bank announced a 0.25% interest rate hike after its policy meeting, marking the 10th consecutive interest rate increase since the start of the tightening cycle in July last year. The market initially expected interest rates to remain unchanged. ECB President Christine Lagarde hinted that this might be the last interest rate hike, stating that current rates are sufficient to counter inflation. However, she added that further rate hikes were not ruled out if economic data disappoints. 

Asia Pacific 

The Reserve Bank of Australia (RBA) maintained its benchmark interest rate at 4.1% as expected. The new RBA Governor, Michele Bullock, stated that although inflation has peaked, she believes it will remain at high levels for some time. The data reflects easing inflationary pressures in commodity prices but continued upward pressure on service sector inflation, as well as recent increases in fuel prices and rental inflation. 

In India, data from the Reserve Bank of India showed that household net savings as a percentage of GDP reached a 50-year low at 5.1%, indicating potential economic pressures on growth. 

In the Japanese market, the USD/JPY exchange rate tumbled past 150 before retreating back to the 148 level. Market estimations suggest that the Bank of Japan may intervene to prevent further yen appreciation, indicating that the yen may have reached its bottom. Additionally, the Leading Economic Index for August surged much higher than expected, serving as an important indicator for assessing the current strength and turning points of the Japanese economy. The stock market performance in Japan has outperformed other regions, with Japanese equity funds ranking first among equity funds, delivering a return of up to 16.1% since the beginning of 2023, surpassing the performance of funds in China, Hong Kong, and other Asian regions. 

Table 2: Ranking of Equity Fund Performance According To September Returns  

Ranking Equity Sub-category Fund Index September 2023 Return (%) 2023 YTD Return (%) 
1 Japanese Equity -1.0% 16.1% 
2 Hong Kong Equity (Index Tracking) -2.7% -7.6% 
3 Asian Equity -2.9% -1.6% 
4 Hong Kong Equity -3.1% -10.7% 
5 Other Equity Fund -3.7% -0.1% 
6 Greater China Equity -4.0% -8.1% 
7 Global Equity -4.3% 9.2% 
8 European Equity -4.3% 8.0% 
9 United States Equity -4.7% 15.0% 

Analysis of Mixed Assets fund performance 

All mixed asset funds yielded negative returns in September. The fund with the largest decline was the “Target Date Fund,” which dropped by 3.7%. The stock market continued its downward trend from August, showing overall weakness. Mixed asset funds with higher allocations to stocks performed worse. The “80% to 100% Equity Fund” and the “60% to 80% Equity Fund” both declined by 3.4% and 3.3% respectively. 

On the other hand, funds with lower allocations to stocks, such as the “Default Investment Strategy (Post-65 Fund)” and the “20% to 40% Equity Fund,” had relatively better performance in September. 

Table 3: Ranking of Mixed Assets Fund Performance According To September Returns 

Ranking Mixed Assets Sub-category Fund Index September 2023 Return (%) 2023 YTD Return (%) 
1 Dynamic Allocation Fund -2.3% -1.4% 
2 DIS Age 65 Plus Fund -2.5% 0.7% 
3 Other Mixed Asset -2.9% -2.5% 
4 Mixed Asset- (>20-40% Equity) -3.0% -1.2% 
5 DIS Core Accumulation Fund -3.2% 5.4% 
6 Mixed Asset- (>40-60% Equity) -3.2% -0.9% 
7 Mixed Asset- (>60-80% Equity) -3.3% 0.3% 
8 Mixed Asset- (>80-100% Equity) -3.4% 1.3% 
9 Target-Date Fund -3.7% 0.4% 

Analysis of Bond & Money Markets Fund Performance 

As of October 6th, the yield on the 10-year US Treasury bond reached 4.74%, the highest level since July 2007. Bond prices have declined as a result. The “Conservative MPF Fund” and the “Hong Kong Money Market Fund” generated positive returns in September. In terms of year-to-date performance, both “Hong Kong Money Market Fund” and  “Conservative MPF Fund” outperformed its peers in this asset class, recording a 2.5% return. The “RMB and HKD Money Market Fund,” “RMB Bond Fund,” “Asian Bond Fund,” and “Global Bond Fund” have recorded negative returns, with declines ranging from 0.2% to 2.3%. 

Table 4: Ranking of Bond & Money Markets Fund Performance According To September Returns 

Ranking Bond & Money Markets Sub-category Fund Index September 2023 Return (%) 2023 YTD Return (%) 
1 Conservative Fund 0.3% 2.5% 
2 HKD Money Market Fund 0.1% 2.5% 
3 RMB & HKD Money Market Fund 0.0% -1.1% 
4 RMB Bond -0.4% -0.2% 
5 Guaranteed Fund -0.6% 0.2% 
6 Hong Kong Dollar Bond -1.1% 0.9% 
7 Asian Bond -1.9% -1.2% 
8 Global Bond -3.0% -2.3% 


  1. The average MPF return per member is calculated using total MPF assets of the previous month. This was 1,115,000 million HKD as of 31 August 2023. The number of MPF Scheme members was 4,694,000 as of 31 March 2023. The latest average assets per member was HK$237,537 as of 31 August 2023.  

*The growth of all fund categories indexes is calculated by asset-weighted point-to-point growth. The data for September 2023 return is summarized from 1 September to 30 September 2023.   


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