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Investment Sentiment Recovered Equity Market Rebounded All MPF sectors recorded positive returns Convoy MPF Composite Index Increased by 1.91%

(28, June 2019—Hong Kong) As of 19 June, the Convoy MPF Composite Index was 230.81, with an 1.91% month-to-month increase. The Convoy MPF Equity Index was 247.70 with an increase of 2.46% on a monthly basis, while the Convoy MPF Bond Index was 159.11, with a monthly increase of 1.60%.

 

Investment Sentiment Recovered  All MPF sectors recorded positive returns

Global economy continues to be clouded by the US trade dispute, as well as certain geo-political concerns. While the US trade tension with China has remained unsolved, the Trump administration threatened to impose a 5% levy on all Mexican imports unless the Mexican government takes actions to help stem immigration to the US. Over the other side of the world, the UK Prime Minister Theresa May decided to step aside as Conservative leader and admitted that she has not been able to deliver Brexit. Leading economic indicators such as Purchasing Managers’ Index (PMI) in May were also disappointing across the globe.

 

Under these backdrops, global equities edged lower in the beginning of the period but sentiment subsequently recovered as major central banks, including the US Federal Reserve System, European Central Bank and People’s Bank of China, reassured investors by accommodative stances and laying the probability of rate cuts in the coming months. Overall, equity market saw a rebound and ended the period positively. Fixed income securities were benefited by weakening growth outlook and the dovish stances of major central banks, driving lower yields in June. Within the measuring period, all MPF sectors recorded positive returns, in which the Greater China regional Equities Funds saw strong rebounds thanks to the monetary and fiscal supports of the Chinese government and ranked top among all MPF sectors.

 

Ms. Bonita Leong, Group Chief Product and Strategy Officer, Convoy Global Holdings Limited, said that the past half a year has seen many unexpected events that have had major political, economic and social consequences. With the many political uncertainties, it is advisable to stay invested and focus on the longer term gains as the market is expected to be volatile in the short term. The alternative in these uncertain times is to choose some mixed asset portfolios, where the fund manager may help with decisions on portfolio mix and stock selection. The Default Investment Strategy funds (mixed assets portfolios) increased on average, between 1.82% to 2.15% versus the overall composite index of 1.91% for the month. 

Photo 1: Ms. Bonita Leong, Group Chief Product and Strategy Officer, Convoy Global Holdings Limited, said that with the many political uncertainties, it is advisable to stay invested and focus on the longer term gains as the market is expected to be volatile in the short term. The alternative in these uncertain times is to choose some mixed asset portfolios, where the fund manager may help with decisions on portfolio mix and stock selection. The Default Investment Strategy funds (mixed assets portfolios) increased on average, between 1.82% to 2.15% versus the overall composite index of 1.91% for the month.

 

Summary of Performance of MPF Key Funds Class in June:

  • Equity Funds:
    • China Equity Funds performed the best with a 3.07% month-on-month increase and a 8.25% January-to-date increase
    • Europe Equity Funds performed the worst, recorded a monthly increase of 1.48% and a 13.37% January-to-date increase
       
  • Bonds Funds:
    • Global Bond Funds performed the best, recorded a 1.74% month-on-month increase and a 3.83% January-to-date increase
    • RMB Bond Funds performed the worst, recorded a slight monthly increase of 0.35% and a 2.03% January-to-date increase
       
  • Default Investment Strategy:
    • Mixed Asset – 81% to 100% was the best performing mixed asset sector, with a monthly increase of 2.15% and a 12.22% January-to-date increase
    • Mixed Asset – 21% to 40% was the worst performing mixed asset sector, recorded a 1.82% month-on-month increase and a 6.50% January–to-date increase

 

Convoy MPF Index Trend

  • SOURCE: CONVOY FINANCIAL SERVICES LIMITED
  • COMPILED BY THE CONVOY FINANCIAL SERVICES LIMITED
  • DISCLAIMER: THE CONTENT IS FOR REFERENCE ONLY AND DOES NOT CONSTITUTE ANY SUGGESTION AND OFFER FOR INVESTMENT. PLEASE DO NOT RELY ON THIS ARTICLE FOR YOUR INVESTMENT DECISION. INVESTMENT INVOLVES ELEMENTSOF RISK AND THE HISTORICAL DATA OF THE FUNDS IS NOT NECESSARILY AN INDICATOR OF THEIR FUTURE PERFORMANCE.CONVOY FINANCIAL SERVICES LIMITED ("CONVOY") HAS UNDERTAKEN REASONABLE EFFORT TO PREPARE THE CONVOY MPFINDICES. CONVOY CANNOT GUARANTEE THE ACCURACY
 

Performance of Key Funds Classes:

MPF Fund Sectors#

Month-on-month

January-to-date*

Asian Equity Fund

2.33

8.49

China Equity Fund

3.07

8.25

Europe Equity Fund

1.48

13.37

Global Equity Fund

1.90

16.69

Greater China Equity Fund

2.73

10.91

Hong Kong Equity Fund

2.69

10.79

Hong Kong Equity Fund (Index Tracking)

2.37

10.93

Japan Equity Fund

1.82

8.01

United States Equity Fund

2.26

24.13

Uncategorized Equity Fund

2.49

13.41

Asia Bond Fund

1.62

3.51

Global Bond Fund

1.74

3.83

Hong Kong Dollar Bond Fund

1.19

3.73

RMB Bond Fund

0.35

2.03

Guaranteed Fund

0.83

3.14

Mixed Assets Fund (21% to 40% equity)

1.82

6.50

Mixed Assets Fund (41% to 60% equity)

1.96

8.46

Mixed Assets Fund (61% to 80% equity)

1.98

9.75

Mixed Assets Fund (81% to 100% equity)

2.15

12.22

Default Investment Strategy – Age 65 Plus Fund

2.07

7.31

Default Investment Strategy–Core Accumulation Fund

2.06

12.40

Uncategorized Mixed Assets Fund

1.93

10.88

MPF Conservative Fund

0.08

0.50

Money Market Fund – Other than MPF Conservative Fund

0.13

0.77

 

#MPF FUND SECTORS BASED ON MPFA CLASSIFICATION

*PERFORMANCE IS CALCULATED FROM 22 MAY 2019 TO 19 JUNE 2019; PERFORMANCE OF JANUARY-TO-DATE IS CALCULATED FROM 24 DECEMBER 2018

SOURCE: CONVOY FINANCIAL SERVICES LIMITED

COMPILED BY THE CONVOY FINANCIAL SERVICES LIMITED

DISCLAIMER: THE CONTENT IS FOR REFERENCE ONLY AND DOES NOT CONSTITUTE ANY SUGGESTION AND OFFER FOR INVESTMENT. PLEASE DO NOT RELY ON THIS ARTICLE FOR YOUR INVESTMENT DECISION. INVESTMENT INVOLVES ELEMENTSOF RISK AND THE HISTORICAL DATA OF THE FUNDSS IS NOT NECESSARILY AN INDICATOR OF THEIR FUTURE PERFORMANCE.CONVOY FINANCIAL SERVICES LIMITED ("CONVOY") HAS UNDERTAKEN REASONABLE EFFORT TO PREPARE THE CONVOY MPFINDICES. CONVOY CANNOT GUARANTEE THE ACCURACY

 

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