Actively Seeking New Breakthroughs First Reduction of Individual Pension Fund

◎ Reporter Chen Yue

In the case of unsatisfactory performance and investment experience, individual pension funds are trying to make some positive changes.

On April 25, Fuguo Fund announced that its Fuguo Xinwang Robust Pension Target one-year holding period hybrid FOF would reduce the fund management rate and custody rate from April 29, 2024. Specifically, it is proposed to adjust the annual management rate of Class A shares from 1.00% to 0.60%, and the annual custody rate from 0.20% to 0.15%; The annual management rate of Class Y shares is adjusted from 0.50% to 0.30%, and the annual custody rate is adjusted from 0.10% to 0.075%.

This is the first time that the management rate and related rates of the individual pension fund (Y share) have been lowered since its inception. Choice statistics show that as of April 26, there were 187 individual pension funds in the whole market, with annual management rate ranging from 0.15% to 0.5%, and annual custody rate ranging from 0.05% to 0.15%.

The reporter interviewed several fund companies in the industry in this regard, and some insiders said that their individual pension funds had no plans to follow up and reduce fees. However, according to insiders, personal pension funds have received a lot of attention recently, or are expected to usher in some changes in product rules to attract more investors.

In fact, since the individual pension funds came out in November 2022, affected by the A-share market, their performance has not been satisfactory. Choice statistics show that, as of April 25, 2024, the average loss of individual pension funds across the market since its inception is 4.79%, of which only 31 products have achieved positive returns. The two products with the highest yield, CEIBS Foresight Pension Goal 2045 and CEIBS Foresight Balanced Pension Three Year Holding FOF Y, were established at the beginning of February this year. Since their establishment, the yield has been above 6%, and the market entry time point is relatively dominant. On the other hand, since its establishment, there have been 37 products whose yield has retreated more than 10%, and one of them has retreated more than 20%.

The scale of individual pension funds grew relatively slowly. According to the public data of the Fund's quarterly report, as early as the end of the second quarter of 2023, the size of individual pension funds exceeded 5 billion yuan, when there were only 151 individual pension funds; By the end of 2023, the total scale will be only about 5.8 billion yuan; As of the end of the first quarter of 2024, there are only about 6.5 billion yuan, and the number of personal pension funds in the whole market has reached 187. Compared with the growth in the number of products, the growth in scale is very limited.

"Among various types of personal pension investment products, the advantages of public funds are transparent management, low management costs and rich equity investment experience. Therefore, public pension target funds are more suitable for investors to choose when pursuing reasonable returns. Of course, the disadvantage of public funds is that in the stage of poor performance in the equity market, they may show the characteristics of large short-term withdrawal and large volatility. We have also seen this in the past year or two, and will make further improvements in smoothing the fluctuation of net worth and improving the experience of investors. " The director of FOF investment department of a large fund company in Beijing told the reporter.

For investors who feel bad, how should they continue their personal pension reserves? The above people believe that, first of all, pension investment is a long-term investment. It is normal for the market to fluctuate. As long as there is no obvious deviation between the investment product style and the investment goal, long-term persistence can bridge the risk of market fluctuations.

The person said that if investors only invest by experience, there is very little chance to buy at the real low level of the market. Because the low market is often a bad time for most investors. In order to overcome this innate reverse mechanism of the investment market, investors often have better results in disciplined investment than investing by experience. The simplest form of disciplined investment is regular investment. If investors are confused about the choice of pension products, they can choose to further diversify their investment, such as choosing three to five products from different companies to further reduce the volatility of the overall portfolio.