How ready are index managers for MPF?

Hong Kong''s legislature is paving the way for MPF investors to choose index-tracking funds. The providers discuss strategy.

Hong Kong's Legislative Council is now considering an amendment to the Mandatory Provident Fund Schemes Bill that, among other things, will lift some restrictions on how MPF members can invest their funds. The most significant change is to allow MPF constituent funds to invest up to 100% into an exchange-traded fund ETF or other index-tracking fund product. This means global ETF players such as State Street Global Advisors SSGA and Barclays Global Investors BGI are thinking about how to enter the already crowded MPF field.

At this stage, index fund providers have no immediate intention of wading into the MPF market. They must still wait for Legco to pass the amendment. Although the content of...

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