MPF on track for historic $150bn investment bonanza

4th October 2024

Mainland stimulus measures send MPF account values soaring

MPF Ratings’ September MPF Performance Survey has now been uploaded.

Key points are as follows:

Propelled by sweeping Mainland economic stimuli, MPF Ratings’ MPFR All Fund Performance Index soared 4.81% in September, contributing to a Q3 MPF system gain of 7.24% (best quarterly return since Q4 2022) and a year-to-date gain of 12.77% (best first nine-month performance since 2017 and 4th best on record). (See Table 1)
In absolute dollar terms, September’s MPF investment gain is equivalent to approximately $60.7bn (or $12,800 per MPF’s 4.75m members) contributing to a Q3 gain of $89.2bn (or $18,800 per member) and year-to-date gain of $148.8bn (or $31,300 per member).
The result of the Mainland economic measures was a MPF system best 18.07% return for HK and China equities. Such was the comparative strength of September’s return, HK & China equities is now also MPF’s best performing asset class in Q3 and year-to-date.
Hong Kong and China equities breaks numerous records. Its 1 month return is the 2nd best on record, a Q3 return of 18.48% is the best quarterly return since Q2 2009, and its year-to-date return of 23.62% is the best first nine-month return since 2017 and its 5th highest on record. (Also see Table 1)
Factoring in contributions, total MPF assets end September at an estimated $1.327tr (up $64.7bn from end of August, $101.1bn from Q2 and $186.3bn for year-to-date), equivalent to an average MPF account balance of $279,100 for MPF’s 4.75m members (up $13,600 from August, $21,300 from Q2 and $39,200 for year-to-date).
A total asset size of $1.327tr and an average member account balance of $279,100 are all-time record highs with the average member account balance surpassing the previous high of $268,900, achieved in June 2021.

Francis Chung (叢川普), Chairman of MPF Ratings Ltd, Hong Kong’s independent provider of MPF research, views and education today released MPF Ratings’ September MPF Performance Survey by highlighting the material MPF wealth created by the announcement of sweeping Mainland economic stimuli in late September. September MPF investment earnings grew by $60.7bn to take Q3 2024 earnings to $89.2bn and year-to-date MPF gains to almost $150bn, at $148.8bn. Hong Kong and China equities was MPF’s biggest winners, up 18.07% to now be MPF’s 2024 best performing asset class as MPF’s total asset size and average member account balances both reach all-time record highs. After factoring MPF contributions, MPF’s asset size is now $1.327tr while the average account balance is now just below $280,000 at $279,100.

Quotes:

All-time record MPF member account balances is a big reward for MPF’s members

“At 279,100 MPF’s average account balance is not only a record amount but is now worth more than a brand-new Tesla Model 3 Rear Wheel Drive or a collection of exclusive Hermès handbags. I don’t say this to glamourize or trivialize MPF, but rather to highlight the real value MPF has brought to its 4.75m MPF members.”

Timely stimuli fire up local markets

“The Mainland’s sweeping economic stimuli announcement has transformed Hong Kong and China equities performance. A September month’s return of 18.07% is not only the asset class’ 2nd best ever monthly return but now sees local equities as MPF’s best performing 2024 asset class.”

Outlook for 2024 – MPF is on track to achieve historic $150bn investment gains

“Year-to-date the MPF system is presently delivering a return of 12.77% with all MPF asset classes recording positive gains. While markets are facing several headwinds, if markets track favourably, the MPF system could achieve calendar year investment gains greater than $150bn for the first time ever which would be a great reward for MPF’s 4.75m members.”

Table 1: MPF Ratings’ MPFR Index returns by asset class (as at 30th September 2024)