Rising inflationary pressures, and a more hawkish stance of global central banks, did not deter equity outperformance in October.
Last month, the MPF scheme generated a 1.72% return. Risky assets continue to outperform, with S&P 500 returning 6.9%. MPFs in the US equity category were in line with the benchmark, posting a 6.2% gain during the month. Global and Europe equities also did well, ranking the second and the third places with a 5.0% and 3.9% return, respectively. These categories are also the leaders so far this year, with double digit returns.
Greater China equities have endured multiple hits due to the sector-targeted regulatory resets. China and Hong Kong MPFs recovered around 2% on average last month, narrowing their year-to-date retreats to a 6.5% loss. On a three-year basis, despite the most recent sacrifice of returns, China & Greater China equity returned 12.7% each year, ranking only behind US equity, global equity and Asia ex-Japan equity funds.
Weaker performers included Japan equity. The category lost steam as a buoy by the new prime minister appointment was short-lived. MPF contributors still earned 6.8% from Japan equities between January and October, however.
Other conservative investments, such as global and regional bond funds as well as guaranteed funds, continued to come under pressure. Hong Kong dollar bond category, which composes seven funds, was down 0.8% on average. A total of 24 global bond funds dipped another 0.5% in October, deepening the year-to-date loss to 4.7%.
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