Hong Kong’s Mandatory Provident Fund (MPF) members pocketed record gains in 2025, with average earnings surging to about HK$45,900 ($5,900)  per person, more than doubling from 2024, according to advisory firm GUM.

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GUM on Wednesday reported that its composite MPF index, a benchmark tracking the pension funds’ overall performance, logged a year-on-year increase of 16.7 percent, the highest in eight years.

The Greater China Equity Fund, fueled by the Hong Kong stock market’s resurgence, emerged as the top performer with a yearly return of about 34 percent.

Funds focused on Asian and European stock markets also posted significant returns of around 25 to 26 percent. The United States Equity Fund, however, managed only a 14.3 percent return last year, according to GUM.

The firm noted that in the first half of 2025, many MPF members adopted a high risk-averse approach to portfolio allocation, amid uncertainties triggered by the Trump administration’s aggressive diplomatic and trade stance.

Though global trade talks made headway and artificial intelligence technology spurred momentum in financial markets in the second half, MPF members remained cautious and “oscillating between risk-on and risk-off” strategies, GUM added.

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Looking ahead, “the US dollar is expected to weaken slowly in the long term, and non-US dollar assets are likely to continue benefiting from exchange rate advantages, enhancing overall return potential,” said Christopher Lau, GUM’s chief investment officer.

On Hong Kong equities, Lau said the market is poised to develop steadily. With the Chinese central government likely to sustain a proactive fiscal policy and loose monetary measures, he added, Hong Kong equity funds are “worth paying attention to”.

The Mandatory Provident Fund Schemes Authority on Tuesday said the MPF recorded its third straight year of positive return, with the overall net return rising to 16.5 percent in 2025, up from 8.6 percent a year earlier.  

Benefiting from the robust investment performance, total MPF assets increased to approximately HK$1.55 trillion by the end of December, setting another historic high.

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All fund categories —- including equities, mixed assets, and bonds – registered positive returns over the past year. Equity funds, which make up nearly half of total MPF assets, generated an average annualized net return of 24.8 percent in the past 12 months. Mixed assets funds returned 16.8 percent, while bond funds posted 5.9 percent, the authority’s data showed.

Meanwhile, the core accumulation fund under the default investment strategy fund — which automatically adjusts the allocation between equities and bonds based on MPF members’ age-related risk profiles — also recorded a return of 14 percent in 2025.

Contact the writer at gabylin@chinadailyhk.com