City’s pension fund gains nearly HK$100b this year

By the Editorial Team · Thursday, October 8, 2026

Hong Kong’s Mandatory Provident Fund generated a net return of nearly HK$100 billion in the first nine months of 2026 despite a 1.47 percent loss in September driven by declines in both equities and bonds. The fund's strong year-to-date performance and diversified investment approach support optimism for positive overall returns by year-end, reinforcing the importance of a long-term investment strategy for members.

Hong Kong’s Mandatory Provident Fund (MPF) recorded a net gain of nearly HK$100 billion over the first nine months of 2026, despite experiencing a loss in September, according to data released by MPF Ratings. The city’s compulsory retirement savings scheme, which covers approximately 4.97 million members, saw its 382 investment funds deliver an average return of 6.2 percent year-to-date through September. However, the funds collectively posted a 1.47 percent decline in September alone.

In monetary terms, the MPF investment pool earned HK$96.9 billion during the first three quarters but lost HK$25.1 billion in September. On average, individual members’ pension accounts decreased by HK$5,060 in September but remained up by HK$20,161 over the nine-month period.

Francis Chung, chairman of MPF Ratings, attributed the setback in September to simultaneous losses in both equities and bonds. He noted that elevated US Treasury yields, ongoing inflation worries, and concerns over a possible economic slowdown challenged traditional diversification approaches during that month. Nonetheless, Chung encouraged investors to maintain diversified portfolios and adopt a long-term perspective, cautioning against reacting to short-term volatility driven by interest rate fluctuations and geopolitical uncertainties.

The Mandatory Provident Fund Schemes Authority (MPFA), the pension regulator, echoed this advice, warning against short-term trading strategies that could lead members to “buy high and sell low,” resulting in avoidable losses. The MPFA emphasized that MPF investments are designed for the long term, typically spanning over four decades, and cautioned against attempts to time market trends.

As of September 30, total assets under the MPF stood at HK$1.68 trillion, up HK$130 billion from the end of 2025, reflecting both investment returns and steady member contributions. The average balance per member was HK$338,950.

Equity funds focused on Hong Kong and mainland China remained the most popular choice among members, accounting for more than one-third of total assets. These funds posted a 3 percent loss in September but achieved a modest 1.6 percent gain over the first nine months. Bond funds, including Hong Kong dollar and Asian bond funds, recorded declines of 2.5 percent and 2.3 percent respectively over the same period.

Mixed-asset funds, which allocate investments across both equities and bonds, performed relatively well, posting average gains between 7.9 percent and 9.5 percent year-to-date. Funds with higher equity exposure tended to outperform those with more conservative allocations. The default investment strategy (DIS) funds—age-adjusted mixed-asset portfolios—also delivered positive returns, with those emphasizing stocks gaining 7.3 percent and more bond-oriented DIS funds rising by 0.7 percent through September.

Looking ahead, Francis Chung expressed optimism that the MPF would finish 2026 with an overall positive return, supported by the diversification and long-term focus underpinning the fund structure.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.