Hong Kong’s MPF investment funds start new year with biggest loss in eight months: Lipper data
- The 414 investment funds covered by MPF post a 1.87 per cent loss in January, the most since May 2019
- China equity funds lead losses, reflecting Hong Kong market slide; gains in bond funds limit the damage
Investment funds covered by Hong Kong’s Mandatory Provident Fund recorded their worst performance in eight months as the outbreak of coronavirus in mainland China triggered a global market selloff during Lunar New Year.
The 414 funds recorded a 1.87 per cent loss on average in January, the most since a 4.09 per cent setback in May last year when trade war between the US and China escalated, according to data provider Lipper. The firm is part of the Refinitiv group, which tracks the performance of funds offered by MPF to 2.9 million employees and self-employed people in the city.
The poor start to the new year came after MPF ended 2019 with a 12.6 per cent average gain, its third-best year of the decade.
Stocks plunged in Hong Kong after markets reopened for trading on January 29, and losses hit Tokyo to London as the coronavirus outbreak claimed more lives and spread to more than a dozen countries. China’s markets followed on February 3 after an extended halt in trading.
Unsurprisingly, China equity funds were the worst performers among all categories of funds. They lost 7.8 per cent on average in January, not far off the 8 per cent decline in an index tracking mainland companies listed in Hong Kong.
The MPF imposed tough restrictions about investment in so-called A shares, or onshore listed shares of mainland companies. Thus, the performance of China equity funds mainly reflects H-shares performance in Hong Kong.
Hong Kong equity funds were the second-worst performers, losing 6.5 per cent and tracking 6.7 per cent slide in the benchmark Hang Seng Index. South Korea equity funds also slumped, by 5.3 per cent.
