Europe, Japan and Hong Kong equities are playing catch-up year-to-date, generating strong performance in the MPFs too. Six of the top 10 MFPs of May 2021 were European equity funds. Products offered by AIA, Hang Seng and HSBC each returned around 4%.
These MPF categories do not perform on a long-term basis. The respective trailing three-year annualised returns of Europe, Japan and Hong Kong equity funds were 6.67%, 5.07% and 4.66% on average. With US$ 24 billion under management, the Hong Kong equity MPFs make up the largest category as of the end of last month. However, its three-year performance was merely better than money market and bond portfolios offered in the scheme. Factoring in volatility metrics, Hong Kong equity MPFs were not attractive from a risk-adjusted basis.
On the other hand, top year-to-date performers US equity and Global equity funds lost steam in May. Both ended the month flat after mixed sessions throughout the month.
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