Hong Kong MPF on target for finest return in 4 years this yr; outlook ‘constructive’ for 2025

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The Obligatory Provident Fund is on target to report its finest efficiency in 4 years in 2024, whereas most analysts imagine subsequent yr’s efficiency will stay on a constructive trajectory.

As of December 18, the MPF’s 379 funding funds had an estimated achieve of HK$102.8 billion (US$13.2 billion) for this yr, the third time the fund’s achieve has exceeded HK$100 billion, in accordance with MPF Rankings, an unbiased analysis agency.

The US inventory funds have been the most effective performers up to now this yr, boasting a 21.5 per cent achieve, with Japan inventory funds second at 18.7 per cent. China and Hong Kong inventory funds ranked third at 15.5 per cent.

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Established in 2000, MPF is a obligatory retirement scheme that covers 4.7 million present and former employees.

An illustration of the MPF in Hong Kong, on 29 March 2018. Picture: Martin Chan alt=An illustration of the MPF in Hong Kong, on 29 March 2018. Picture: Martin Chan>

Wanting forward, Francis Chung, chairman of MPF Rankings, stated the incoming Trump administration ought to make for an attention-grabbing 2025.

“Protectionism and deregulation look like Trump’s calling card, and whereas the rhetoric is proving standard for US equities, there may additionally be unintended penalties,” Chung stated. “MPF members could also be tempted to have a US bias of their portfolio, however diversification is necessary.”

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Philip Tso, head of APAC institutional enterprise at Allianz International Traders, stated MPF members can contemplate leaning extra towards higher-risk property in 2025.

“As we enter 2025, following a decisive outcome within the US election, the outlook for dangerous property appears constructive, with a comfortable touchdown in sight for the US and world economies regardless of the potential for volatility forward,” Tso stated.

Tso stated Trump’s guarantees of decrease company taxes and deregulation ought to carry extra positivity to the market and profit company margins.

Folks posed in entrance of a Christmas tree outdoors the New York Inventory Trade. Picture: Agence France-Presse alt=Folks posed in entrance of a Christmas tree outdoors the New York Inventory Trade. Picture: Agence France-Presse>

“If these measures result in a interval of calm in fairness markets, buyers might enhance fairness positions,” he stated. “We see this surroundings as notably beneficial for US equities.”

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