Hong Kong’s retirement fund posts best return since 2009 with 20.6 per cent growth
Employees who invested their contributions in equity funds were the biggest winners in 2017, with the best performers showing returns of nearly 40 per cent
Hong Kong’s Mandatory Provident Fund, the compulsory retirement plan for 2.8 million employees and self-employed people in the city, reported a 20.55 per cent return in 2017 – the strongest performance since 2009 on the back of the stellar performances of stock markets across the world, according to data from fund research company Thomson Reuters Lipper.
The performance was far better than the 1.24 per cent return in 2016, and a loss of 3.16 per cent in 2015. It was also the best year since 2009, when it posted a return of 27.25 per cent.
The returns meant that each Hong Kong employee on average would have earned about HK$20.55 for every HK$100 in their funds last year.
But the average performance of the 481 funds was still lower than the 36 per cent gain in Hong Kong’s benchmark Hang Seng Index, the best-performing stock market in the world last year. This is because many MPF funds had invested in money market or bond funds that gave lower returns, dragging down the overall profit.
The returns, however, were far better than the city’s inflation rate of 1.6 per cent in November.