Like Tree184Likes

MPF: how to boost returns?

Closed Thread
Page 6 of 20 FirstFirst ... 3 4 5 6 7 8 9 14 ... LastLast
  1. #51

    Join Date
    Dec 2002
    Location
    薄扶林
    Posts
    47,968

    The authority has no power in controlling service fees of funds other than those managed by the default investment strategy
    This is important though. They could get these providers to drop the fees down to 2800 levels. They have the authority to show people how the expensive fees are affecting future returns. They can educate people how fees affect returns. They can educate and highlight funds that don't meet market performance.

    A simple tag "fund has failed to beat inflation after fees" would be good enough of a start.
    jrkob likes this.

  2. #52
    Quote Originally Posted by shri:
    This is important though. They could get these providers to drop the fees down to 2800 levels. They have the authority to show people how the expensive fees are affecting future returns. They can educate people how fees affect returns. They can educate and highlight funds that don't meet market performance.

    A simple tag "fund has failed to beat inflation after fees" would be good enough of a start.
    More competition by having a larger pool of providers and higher contributions through the tax-deductible voluntary scheme should also reduce fees. We shall see I guess.

    Is Geoclicks bidding for this fecking simple e-platform?

  3. #53

    Join Date
    Dec 2002
    Location
    薄扶林
    Posts
    47,968

    that would mean I'd have to hire java programmers who can code specifically for IE browsers. :P

    civil_servant likes this.

  4. #54

    Join Date
    Nov 2005
    Location
    Cramped island
    Posts
    5,585

    had a chat with pin the other day over drinks on this..

    i don't think the issue is about having more competitors and fees will reduce..
    there are enough competitors and due to this, the assets at individual mpf provider is probably not sufficient for them to lower the fees..
    TBH, i did not study the structure in detail, but i suspect the original structure setup of MPF by HK gov tried to play it too smart and conservative, adding layers and layers into the structure. Once you do that, the cost in maintaining the layers just made the lawyers rich and the investors poorer..

    Contrasting the singapore structure, cpf is like a saving account and investments can be made from cpf into listed ETFs, etc... (even though the choices of listed ETF in singapore is miserable)... so in a way its more efficient and cost optimal..

    shri likes this.

  5. #55

    Join Date
    Dec 2002
    Location
    薄扶林
    Posts
    47,968
    HK gov tried to play it too smart and conservative, adding layers and layers into the structure. Once you do that, the cost in maintaining the layers just made the lawyers rich and the investors poorer..
    Yes I do suspect this is the case, but the fact that they have so many sales agents on commission, competing for business and earning salaries essentially from what the contributions are, is troubling.

  6. #56

    Join Date
    Nov 2005
    Location
    Cramped island
    Posts
    5,585
    Quote Originally Posted by shri:
    Yes I do suspect this is the case, but the fact that they have so many sales agents on commission, competing for business and earning salaries essentially from what the contributions are, is troubling.
    then that's where the problem is, right?!
    if we think the number of sales is too many, adding provider is not going to help.. there are just going to have even more sales and lawyers to cream off the pie. A new provider comes in, hire 20 sales to go around pitching their proposal, incumbent provider need to hire sales to fend off these attacks.. etc.etc.. just going to make it worse..

    In singapore cpf, there is just 1 key provider or custodian of the money, the CPF. So to workers that are using cpf, this looks like a bank account that you save money into. After that, cpf owners can go to one of the few authorised banks to open an investment account. From the investment account, the owners can choose to keep money in cash (earning 2.5% p.a. interest) or they can invest into shares/funds. Shares/ETF only from the Singapore exchange. Mutual funds available are typical retail funds at 1.5~2.0% p.a. charges.

    The sales are typically the insurance peddler or the bankers.. when they see the money you have in your cpf account, they will try their might to get you to part with the money into one of those junkier products...
    shri likes this.

  7. #57

    Join Date
    Dec 2002
    Location
    薄扶林
    Posts
    47,968
    Shares/ETF only from the Singapore exchange.
    If they allowed it in HK, just like the banks have their monthly savings plan here - buy 2800 + 30-40-50 other stocks at "0%" commission, the rest of the issues would sort themselves out. Sure you'd have a few unqualified people left unemployed, but they can go sell the new voluntary thingy....

    The mandatory part should be considered sacred by the govt and protected from excessive fees and funds - much like the Singapore scheme works.

  8. #58

    Join Date
    Nov 2005
    Location
    Cramped island
    Posts
    5,585

    i don't know.. i think the HK government is worried that HKers are too good at punting stocks and probably the enigma 50 will shoot thru the roof if they allow MPF money to be used on buying shares in the HKEX.

    there are many who advocate that the earlier bubble in singapore stock market (and subsequent crashes) were caused by CPF allowing almost all shares in singapore exchange to be bought by cpf money.. fueling tonnes and tonnes of speculations.


  9. #59

    Join Date
    Dec 2002
    Location
    薄扶林
    Posts
    47,968
    enigma 50 will shoot thru the roof
    So, allow them to invest in 2800 and its constituents + ETFs.

    No need to restrict options for the investors because of inept listing rules / enforcement.

    Besides, with the multitude of blackbox funds that your money goes into with the MPF - you have no clue what it is propping up.

  10. #60

    Join Date
    Nov 2005
    Location
    Cramped island
    Posts
    5,585

    you can always try set up something call the geoclick low cost mpf... charging just $1 HKD per click any mpf client has on your site as your purchase 2800 and 2822 for them. 8-)


Closed Thread
Page 6 of 20 FirstFirst ... 3 4 5 6 7 8 9 14 ... LastLast