GUM: Global Stocks Slide in October, MPF Average Return Per Person Down HKD 6,405 YTD

Nov 7, 2023
Reading Time: 11 minutes

Market Implements Rescue Measures, November Performance Expected to Improve

November 6, 2023】- In October 2023, the “GUM MPF Composite Index” fell by 2.6%, closing at 211.84 points. The “GUM MPF Equity Fund Index” dropped by 3.7%, closing at 275.15 points. The “GUM MPF Mixed Asset Fund Index” declined by 2.8%, closing at 211.08 points. The “GUM MPF Fixed Income Fund Index” experienced a slight decrease of 0.1%, closing at 123.06 points. In October 2023, the average loss per member in the MPF amounted to HK$5,934, resulting in a total loss of HK$6,405 year-to-date.

GUM Strategic and Analytic Consultant, Martin Wan, stated, “October market sentiment remained pessimistic, but November shows signs of improvement. The Federal Reserve announced to keep interest rates unchanged in its November meeting as market expected and the Treasury Department has lowered debt issuance plans, signaling the end of the interest rate hike cycle. China’s increased issuance of government bonds and higher budget deficit target also contribute to market expectations of further measures.”

He further stated, “Retirement funds are allocated for long-term investments, so they should not try to time the market. Both the Chinese and Hong Kong stock markets have been lingering at low valuations, making them potentially attractive for long-term investment allocations.”

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

IndexValueOctober 2023 Return (%)2023 YTD Return (%)
GUM MPF Composite Index211.84-2.6%-2.7%
GUMMPF Equity Fund Index275.15-3.7%-5.5%
GUM MPF Mixed Asset Fund Index211.08-2.8%-1.6%
GUM MPF Fixed Income Fund Index123.06-0.1%1.0%
Average MPF Gain/Loss Per Member Note 1 (HK$)-5,934-6,405

Review and Outlook

In the global markets, the three major U.S. stock indices recorded declines in October. The S&P 500 index briefly dropped to the level of 4,140 points but experienced a slight rebound after the U.S. Treasury Department announced lower borrowing requirements for the fourth quarter and the Federal Reserve once again paused interest rate hikes. The index ended the month with a 2.2% decline. With the U.S. Consumer Price Index (CPI) holding at 3.7% year-on-year in September and the core inflation rate easing to 4.1%, in line with market expectations, investors generally believe that inflation in the U.S. is under control.

In the Chinese and Hong Kong stock markets, the turmoil surrounding real estate debt continued to escalate, causing the Hang Seng Index to briefly fall below the 17,000-point level. Hong Kong’s export data remained weak, with overall exports and imports in September declining by 5.3% and 0.4% respectively compared to the same period last year.

Analysis of Equity Fund Performance

China & Hong Kong

China’s GDP growth in the third quarter exceeded expectations, reaching 4.9%. The National Bureau of Statistics stated that GDP growth for the first three quarters was 5.2%. To achieve the annual growth target of around 5%, the fourth-quarter economic growth rate needs to surpass 4.4%. Foreign investment banks generally believe that China’s GDP growth is expected to remain around 5%. UBS, Goldman Sachs, Citigroup, JPMorgan Chase, and Nomura have all raised their forecasts for China’s economy this year.

For Hong Kong market, Chief Executive John Lee Ka Chiu announced a reduction in the stock trading stamp duty rate to 0.1%. Additionally, the government will review the bid-ask spread and explore narrowing the minimum price increment to attract more investors to participate in the Hong Kong stock market.

United States 

Based on market expectations that the Federal Reserve (Fed) has ended its rate hike cycle, the US stock market has rebounded. The Federal Open Market Committee (FOMC) unanimously agreed to maintain the federal funds rate within the range of 5.25% to 5.5%. It is widely predicted that there will be no further interest rate hikes. Fed Chair Jerome Powell stated that no decisions have been made yet for the December meeting, and the committee will take appropriate action at the right time. Powell emphasized that achieving full price stability may still require slower economic growth and a slowdown in the labor market to curb inflation.


European Central Bank President Lagarde stated in October that core inflation in the Eurozone remains high, with rising labor costs offsetting the impact of soaring input costs. It is expected that inflation will gradually decrease to the 2% target level by 2025, and consideration is being given to further raising interest rates.

Asia Pacific

The recent escalation of the Israel-Palestine conflict has intensified global geopolitical risks, particularly impacting Asian stock markets. Stock markets in several Middle Eastern countries have declined, with the Israeli stock market hitting a two-year low. Investors are concerned that the escalation of the conflict could cause to geopolitical risks and economic impacts, leading to the selling of Asian stocks.


The Bank of Japan made adjustments to its large-scale monetary easing policy during its financial policy decision meeting on 31 October. They allowed for a higher upper limit for the fluctuation of long-term interest rates, exceeding the current 1% limit. This marks another adjustment by the Bank of Japan since the changes made to long-term interest rates in July. Following the announcement, the USD/JPY exchange rate briefly fell below the 150 level as the rate increase exceeded expectations.

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

RankingEquity Sub-category Fund IndexOctober 2023 Return (%)2023 YTD Return (%)
1United States Equity-2.3%12.3%
2Other Equity Fund-2.9%-3.0%
3Global Equity-3.2%5.7%
4Japanese Equity-3.7%11.8%
5Hong Kong Equity (Index Tracking)-3.9%-11.2%
6Asian Equity-4.0%-5.5%
7European Equity-4.0%3.7%
8Greater China Equity-4.2%-12.0%
9Hong Kong Equity-4.5%-14.7%

Analysis of Mixed Assets fund performance

Mixed asset funds continued to underperform in October. Among them, “target-date funds” experienced the largest decline, falling by 3.8%. The stock market did not show a significant rebound during the month, leading to poorer performance for mixed asset funds with a higher allocation to stocks. For example, ” Mixed Asset- (80-100% Equity)” and ” Mixed Asset- (60-80% Equity)” declined by 3.8% and 3.1% respectively.

On the other hand, funds with a lower allocation to stocks performed relatively better in October. For instance, the ” DIS aged 65 plus ” and “Mixed Asset- (20-40% Equity) ” declined by 1.2% and 1.9% respectively.

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

RankingMixed Assets Sub-category Fund IndexOctober 2023 Return (%)2023 YTD Return (%)
1DIS Age 65 Plus -1.2%-0.5%
2Mixed Asset- (20-40% Equity) -1.9%-3.1%
3Dynamic Allocation -2.0%-3.4%
4DIS Core Accumulation-2.0%3.3%
5Other Mixed Asset-2.3%-4.5%
6Mixed Asset- (40-60% Equity)-2.6%-3.4%
7Mixed Asset- (60-80% Equity)-3.1%-2.8%
8Mixed Asset- (80-100% Equity)-3.8%-2.6%
9Target-Date Fund-3.8%-3.5%

Analysis of Fixed Income Fund Performance

The yield on the 10-year U.S. Treasury bond briefly approached 5%, putting continued pressure on bond funds. Both “Asian Bond Funds” and “Global Bond Funds” recorded negative returns, with a decline of approximately 1.3%. Their performance has also been weaker year-to-date, with returns of -2.5% and -3.5% respectively. The “Conservative Funds” and “Hong Kong Money Market Funds” continued to provide positive returns of 0.3% in October. Year-to-date, both funds have achieved an increase of 2.8%.

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

RankingFixed Income Sub-category Fund IndexOctober 2023 Return (%)2023 YTD Return (%)
1Conservative Fund0.3%2.8%
2HKD Money Market Fund0.3%2.8%
3Hong Kong Dollar Bond Fund-0.1%0.8%
4RMB & HKD Money Market Fund-0.3%-1.4%
5Guaranteed Fund-0.3%-0.1%
6RMB Bond Fund-0.6%-0.8%
7Asian Bond Fund-1.3%-2.5%
8Global Bond Fund-1.3%-3.5%


The average MPF return per member is calculated using total MPF assets of the previous month. This was 1,088,000 million HKD as of 30 September 2023. The latest average assets per member was HK$231,785 as of 30 September 2023. The number of MPF Scheme members was 4,694,000 as of 31 March 2023. The GUM MPF Composite Index return for October 2023 as of October 31, 2023.”

*The growth of all fund categories indexes is calculated by asset-weighted point-to-point growth. The data for October 2023 return is summarized from 1 October to 31 October 2023.  


About GUM 

GUM is a boutique consulting firm that provides solutions to corporate on MPF and employee benefits. We focus on people and that is why we put “U” in the very core of our brand “GUM”.  Our priorities are always meeting the needs of our corporate clients and their employees, our strategic partners as well as all MPF members of Hong Kong. With our vast market experience and expert teams around actuarial, investment and employee communication, GUM leads the market to innovate, walking hand in hand with our clients to go faster and further. 

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