Towers Watson MPF Performance Book

Transcription

1 The objective of the Towers Watson MPF Performance Book (the Book ) is to develop a set of standards for the MPF industry to present and compare investment performance of MPF constituent funds. Ultimately, it is our aim to create a valuable tool for members to carry out simple assessments on fund performance achieved by different MPF providers on a fair and objective basis. The Book will be compiled on a quarterly basis with the most up-to-date information incorporated. This Report reviews the investment performance over a number of investment horizons of all 1 MPF constituent funds under the following 22 different investment categories (new categories will be introduced as appropriate). Balanced (Life-Style) Funds Bond Funds Money Market Fund Equity Content: > 80% Equity Content: 60% - 80% Equity Content: 40% - 60% Equity Content: 20% - 40% Hong Kong Dollar Bond Asian Bond Global Bond Hong Kong Dollar Money Market RMB and HKD Money Market Equity Funds Guaranteed Fund MPF Conservative Fund Hong Kong Equity Hong Kong Equity (Index Tracking) Greater China Equity United States Equity Japanese Equity Asia ex Japan Equity Asia ex Japan ex HK Equity Pacific Basin ex Japan Equity European Equity Global Equity Guaranteed Fund MPF Conservative Fund Others Other Funds Asset Allocation information of each fund offered by participating MPF providers 2 is also provided in the Book. A full list of participating providers is provided in the Appendix. 1 Constituent funds which are currently offered within the one employer sponsored scheme are also not included in this Book as they will not be available to general members. 2 Participating MPF providers refer to MPF providers who have participated in the Towers Watson MPF Watch Survey. Towers Watson MPF Performance Book - Introduction

2 Performance Calculation In order to develop a market standard in compiling and presenting investment performance, we have adhered to the following ru les and guidelines: All fund performance is calculated as total return (with dividends re-invested) based on NAV 3 -to-nav or if not available, bid-to-bid. The fund price used for calculations should be net of all fees and expenses on an accrual basis For funds which have more than one class of unit, the unit price of the most expensive class will be used for performance computation For funds which are not dealt daily, the last trading price of each month will be used for computing monthly investment performance In order to comply with the 30% minimum HK Dollar exposure rule established by MPFA, a significant number of MPF funds would be obligated to implement a certain amount of currency hedges. However, it was decided that instead of adjusting fund returns for hedges, benchmarks with the appropriate amount of hedges exposures would be used in order to ensure a fair comparison Benchmark Composition The following table shows the composition of the Towers Watson MPF Benchmark and the respective indices used for each major asset class. Life Style Funds Neutral Asset Allocation (%) > 80% 60% - 80% 40% - 60% 20% - 40% Indices used Global Equity Hong Kong FTSE MPF Hong Kong Index North America FTSE MPF North America Index Europe FTSE MPF Europe Index Japan FTSE MPF Japan Index Pacific Basin ex Japan ex HK FTSE MPF Asia Pacific ex Japan & Hong Kong Index Global Bond Citigroup WGBI (25% hedged to HK$) HK Cash MPFA Prescribed Savings Rate Total Net Asset Value (after all fees) 4 Prior to 1 September 2009, 90% FTSE AW HK + 10% HSBC is being used. Thereafter, FTSE MPF Hong Kong Index is being used.

3 Equity Funds Hong Kong Equity 4 Hong Kong Equity (Index Tracking) 4 Greater China Equity United States Equity Japanese Equity Asia ex Japan Equity Asia ex Japan ex HK Equity Pacific Basin ex Japan Equity European Equity Global Equity FTSE MPF Hong Kong Index MSCI MPF Hong Kong Index FTSE MPF Hong Kong Index Hang Seng Index Total Return Index MSCI MPF Hong Kong Index FTSE MPF Greater China Index MSCI MPF Greater China Index FTSE MPF USA Hedged Index MSCI MPF USA Hedged Index FTSE MPF Japan Hedged Index MSCI MPF Japan Hedged Index FTSE MPF Asia Pacific ex Japan, Australia & New Zealand Index MSCI MPF AC Asia ex Japan Index FTSE MPF Asia Pacific ex Japan & Hong Kong Hedged Index MSCI MPF AC Asia Pacific ex Japan ex HK Hedged Index FTSE MPF Asia Pacific ex Japan Hedged Index MSCI MPF AC Asia Pacific ex Japan Hedged Index FTSE MPF Europe Hedged Index MSCI MPF Europe Hedged Index FTSE MPF All-World Hedged Index MSCI MPF ACWI Hedged Index Bond Funds Hong Kong Dollar Bond Asian Bond Global Bond HSBC Hong Kong Dollar Bond Index Not applicable Citigroup WGBI (35% hedged to HK$)) Guaranteed Fund Guaranteed Fund Not Applicable 5 4 Prior to 1 September 2009, 90% FTSE AW HK + 10% HSBC is being used. Thereafter, FTSE MPF Hong Kong Index is being used. 5 Due to the uniqueness of guaranteed return levels and qualifying events specified for each individual guaranteed fund in the market, it was decided that no benchmark would be assigned for this category.

4 Money Market Funds Hong Kong Dollar Money Market RMB and HKD Money Market MPFA Prescribed Savings Rate Not applicable MPF Conservative Funds MPF Conservative Fund MPFA Prescribed Savings Rate Others Other Funds Not Applicable

5 MPF Providers Covered in the Towers Watson MPF Watch Database as at 30 June 2015 AIA Mandatory Provident Fund Services Allianz Global Investors AMTD Asset Management Limited AXA China Region Insurance Company (Bermuda) Ltd. Bank Consortium Trust Company Ltd. Bank of Communications Bank of East Asia (Trustees) Limited BOCI-Prudential Trustee Ltd. China Life Insurance (Overseas) Company Limited Fidelity Worldwide Investment FWD Life Insurance Company (Bermuda) Ltd. Haitong International Investment Managers Limited Hang Seng Bank Limited HSBC Life (International) Limited Invesco Hong Kong Ltd. Manulife Provident Funds Trust Company Limited MassMutual Asia Limited Principal Trust Company (Asia) Limited Schroder Investment Management (Hong Kong) Ltd. Standard Chartered Bank Sun Life Hong Kong Limited Important Information: The information contained in this Publication has been produced by Towers Watson Investment Services Hong Kong Limited ( Towers Watson ), based on the information provided by participating providers and data available from public sources, e.g. newspapers and the MPFA. Although the information presented in this Publication has been obtained from sources which we believe to be reliable, Towers Watson does not guarantee its accuracy and such information may be incomplete or condensed. All information contained in this Publication is subject to change without prior notice. This Publication is prepared for information purposes only and it is not intended as an offer to purchase or sell of any managed fund. Towers Watson accepts no liability for any direct or consequential loss arising from the use of this Publication or its contents. In all cases, please be reminded that past performance is not an indication of future performance. All rights reserved. Any unauthorised use of duplication without prior permission from Towers Watson is prohibited by law. Please refer to Towers Watson investment consultants for further details.