INVESTORS are piling into Hong Kong's only home-grown index fund, even though the market - and the Hang Seng Index Fund with it - has dropped nearly 13 per cent since the beginning of the year.
Chan Kwok-ping, who manages the fund for Hang Seng Investment Management, said investors were using the down-turn as a buying opportunity, tripling the fund's subscription rate even as the market was falling.
'Investors are confident on the Hong Kong market,' he said.
Their confidence had pushed the HSI Fund's size to $685 million at the end of March, up from $160 million at its launch in August 1995.
Index funds are designed to track a particular market by buying all the stocks in a chosen benchmark - or at least enough of them to mimic the indicator's performance.
They are all the rage in the United States, and gained in popularity as the US market rose and fund managers failed to match the rise, let alone beat it. In 1996, for example, just 24 per cent of actively managed US funds outperformed the Standard & Poor's 500 Index.
