Default Investment Strategy (DIS) 預設投資策略

What is the DIS? 甚麼是預設投資策略？

The Default Investment Strategy (DIS) provides an investment arrangement mainly for members who lack the knowledge to choose funds or the time to manage their investments. Other members may actively select it. Since 1 April 2017, every MPF scheme has been legally required to offer DIS in place of its previous default investment arrangement; where a member makes no fund choice, the relevant MPF benefits must follow DIS.

DIS uses two mixed assets funds: the Core Accumulation Fund (CAF) and the Age 65 Plus Fund (A65F). CAF invests around 60% of its net asset value in higher risk assets and 40% in lower risk assets; A65F invests around 20% and 80% respectively, generally involving mainly equities and bonds. Both funds diversify across global markets and asset classes, including equities, fixed income, money market instruments and cash. [MPFA: Default Investment Strategy](https://www.mpfa.org.hk/en/mpf-investment/portfolio/default-investment-strategy)

DIS adjusts the allocation between the funds by age, covering accrued benefits and future investments under DIS. Below age 50, everything goes into CAF. At age 50, the target is 93.3% CAF and 6.7% A65F, with progressively less CAF each year: for example, 60% and 40% at age 55, and 26.7% and 73.3% at age 60. At age 64, everything goes into A65F. The same applies if the trustee does not know the member's age, so the fund's name does not mean its use starts only at age 65.

Management fees and recurrent out-of-pocket expenses have separate statutory caps. Management fees cover specified service payments involving the trustee, eMPF Platform Company, investment manager, custodian and relevant underlying investments, among others. Their daily aggregate cannot exceed that day's fund net asset value multiplied by 0.75% and divided by the number of days in the year. Recurrent expenses, such as annual audit, routine printing and postage, have an annual cap of 0.2% of fund net asset value, falling to 0.1% after the individual trustee and scheme onboard the eMPF Platform. [MPFA: DIS leaflet](https://www.mpfa.org.hk/en/-/media/files/information-centre/publications/mpf-booklets-and-publications/default-investment-strategy/en/dis_leaflet_eng.pdf)

Rules and Procedures Applicable to Investment through the DIS 選用預設投資策略進行投資的規則和程序

Members may submit investment instructions when opening a new MPF account. Without instructions, the trustee must invest according to DIS. Automatic de-risking applies whether DIS is used by default or actively selected. Members may also select CAF and/or A65F as standalone constituent funds: fee caps and global diversification still apply, but the holdings will not automatically change between the funds according to age. [MPFA: Default Investment Strategy](https://www.mpfa.org.hk/en/mpf-investment/portfolio/default-investment-strategy)

Members may choose DIS or allocate investments among one or more constituent funds offered by their scheme. Some schemes allow part of the benefits to follow DIS while the remainder goes into other funds; the offering document or trustee should be consulted for the actual arrangements. Members may give or change instructions, including switching into or out of DIS, at any time subject to scheme rules. DIS itself has no investment lock-in period.

Annual de-risking takes place automatically from age 50 to age 64, normally on the member's birthday or, if that is not a dealing day, the next available dealing day. CAF units are redeemed and A65F units purchased to reach the allocation prescribed for that age, without fresh annual authorisation. These are targets at the adjustment point: later price movements can change the proportions, which are not held constant throughout the year.

Trustees must clearly disclose how they handle subscription, redemption, switching or transfer instructions received immediately before or on the de-risking date. The interaction between instructions depends on the procedures published for the particular scheme; members should not assume that every scheme processes them in the same order.

Key Risks Relating to the DIS 與預設投資策略有關的主要風險

DIS, CAF and A65F guarantee neither capital nor returns. Even an allocation entirely to A65F can suffer investment losses; lower risk, fee caps and diversification do not provide capital protection. [MPFA: Default Investment Strategy](https://www.mpfa.org.hk/en/mpf-investment/portfolio/default-investment-strategy)

CAF and A65F must comply with the legally prescribed allocation requirements for higher and lower risk assets. This limits the investment manager's discretion to make the portfolio more defensive or aggressive as markets change. Members cannot expect the manager to make unrestricted changes to the asset allocation to avoid a market fall.

Automatic de-risking uses age alone, without assessing current markets or the member's personal financial circumstances. A market fall on the birthday does not itself cause switching to wait for a recovery. Members should read the investment policies and risk disclosures in the offering document and assess whether DIS suits their circumstances.